VAT Exemption and Aesthetic Medicine vs Treatments

Abstract to where aesthetic treatments meet VAT exception.

This paper provides a comprehensive legal and tax analysis of the application of Value Added Tax to aesthetic medicine in the United Kingdom. It examines the statutory framework under the Value Added Tax Act 1994, the role of retained EU law, and the developing body of First-tier and Upper Tribunal case law governing the medical exemption from VAT. Particular focus is given to the litigation in Illuminate Skin Clinics Ltd v HMRC and related tribunal decisions, including Skin Science, Aesthetic-Doctor.com Ltd, and Advanced Hair Technology Ltd, to illustrate how courts apply the principal purpose test, evidential requirements, and burden of proof in practice.

The paper analyses the interaction between VAT law and adjacent regulatory regimes, including CQC regulation, while emphasising their legal separation. It incorporates applied decision tools, including an expanded VAT decision tree, a red–amber–green risk matrix, and a practitioner checklist, to translate legal doctrine into operational guidance. The paper concludes with an assessment of future judicial and legislative developments, arguing that VAT exemption in aesthetic medicine will remain narrow, fact-sensitive, and primarily shaped through tribunal adjudication rather than statutory reform.

1. Introduction

The question of whether aesthetic treatments attract Value Added Tax (VAT) has become one of the most contested legal and financial issues in UK aesthetic practice over the past decade. The difficulty arises because aesthetic interventions sit at the boundary between healthcare and consumer services. VAT law does not recognise “aesthetic medicine” as a distinct category. Instead, it applies long‑established principles concerning the exemption for medical care, developed through statute and case law.

Recent litigation, most notably the dispute between Illuminate Skin Clinics Ltd and HM Revenue and Customs, determined by the Upper Tribunal (Tax and Chancery Chamber) in October 2025, has clarified the correct legal approach without finally determining liability. The case remains live and has been remitted to the First‑tier Tribunal for redetermination.

In plain terms: There is no special VAT rule for aesthetics. The law asks whether a treatment is genuinely medical or essentially cosmetic, and the courts are still refining how that question should be answered.

2. Statutory Framework and Legislative Basis

VAT in the United Kingdom is governed by the Value Added Tax Act 1994. Schedule 9, Group 7 of that Act provides exemptions for certain supplies of medical care.

Item 1 exempts the supply of services consisting of the provision of medical care by a person registered or regulated in a recognised health profession. Item 4 exempts the provision of medical or surgical care in a hospital or state‑regulated institution. These provisions reflect Article 132(1)(c) of the Principal VAT Directive, retained in UK law following withdrawal from the European Union.

The legislation deliberately avoids an exhaustive definition of “medical care”. As a result, interpretation has been developed through judicial decisions, including those of the Court of Justice of the European Union prior to 31 December 2020, which continue to have persuasive authority as retained EU law.

In plain terms: Parliament said medical care should not be taxed, but left it to judges to decide what counts as medical care.

3. Judicial Definition of Medical Care

Judicial authorities consistently define medical care as services supplied for the protection, maintenance or restoration of human health. This formulation appears repeatedly in European and domestic case law, including judgments concerning dental, optical, cosmetic and elective procedures.

The courts have emphasised that the assessment is objective. The relevant question is the principal purpose of the supply viewed in its proper context. Neither the professional status of the provider nor the patient’s personal motivation is determinative.

This approach has been reinforced in a series of First-tier Tribunal decisions involving aesthetic and appearance-led services. In Gillian Graham t/a Skin Science v HMRC (First-tier Tribunal, April 2024), the tribunal held that skincare and aesthetic interventions did not amount to medical care where their dominant purpose was cosmetic enhancement, notwithstanding evidence of psychological benefit. The tribunal reiterated that subjective well-being outcomes do not displace the need for a clinically recognised therapeutic objective.

Similarly, in Aesthetic-Doctor.com Ltd v HMRC and related tribunal decisions concerning aesthetic clinics, the tribunals emphasised that the absence of documented diagnosis and therapeutic intent was fatal to claims for exemption, even where services were delivered by medically trained practitioners.

In plain terms: The court looks at what the treatment is really for. Feeling better or more confident does not make a treatment medical unless it treats a recognised health condition.

4. Cosmetic Purpose and Exclusion from VAT Exemption

A consistent line of authority confirms that procedures carried out for purely cosmetic reasons fall outside the VAT exemption. This applies even where procedures are invasive, involve prescription-only medicines or are delivered in a clinical environment.

In Aesthetic-Doctor.com Ltd v HMRC, the First-tier Tribunal rejected arguments that injectable cosmetic procedures constituted medical care, noting that the services were driven by consumer demand for enhancement rather than clinical necessity. The tribunal accepted HMRC’s position that VAT exemption must be construed strictly and cannot be extended to services whose essential character is cosmetic.

More recently, in Advanced Hair Technology Ltd v HMRC (First-tier Tribunal, 2025), the tribunal considered hair transplant services provided in a clinical setting by medical professionals. It concluded that, in the absence of a diagnosed disease or disorder, treatments for androgenetic alopecia were primarily cosmetic and therefore standard-rated for VAT. The tribunal accepted that some cases might theoretically qualify for exemption, but only where there was robust evidence of a recognised psychological or medical disorder being treated.

In plain terms: Even if a treatment is complex, medicalised or expensive, it will still attract VAT if it is fundamentally about appearance rather than health.

5. Illuminate Skin Clinics Ltd v HMRC and Related Aesthetic VAT Litigation

Illuminate Skin Clinics Ltd v HMRC was first determined by the First-tier Tribunal (Tax Chamber) in June 2023. The tribunal held that the clinic’s injectable aesthetic treatments were cosmetic in nature and therefore standard-rated for VAT, notwithstanding that they were provided by a GMC-registered medical practitioner.

The tribunal found that the clinic had not demonstrated that its treatments were directed at the treatment of disease or disorder. In particular, it noted the absence of structured diagnostic reasoning and the prominence of aesthetic objectives within consultations and marketing materials.

On appeal, the Upper Tribunal (Tax and Chancery Chamber) handed down judgment on 13 October 2025. The Upper Tribunal held that the First-tier Tribunal had erred in law by applying an overly rigid approach which failed properly to consider whether treatments with aesthetic outcomes might nonetheless have a therapeutic or preventative purpose. The Upper Tribunal did not determine VAT liability but remitted the case for redetermination using the correct legal framework.

This approach aligns with earlier aesthetic VAT cases, including Skin Science and Aesthetic-Doctor.com, where tribunals emphasised the need for careful application of the principal purpose test rather than categorical exclusion of all aesthetic treatments.

At the time of writing, the redetermination of the Illuminate case by the First-tier Tribunal has not yet concluded. Further appellate proceedings remain possible.

In plain terms: The higher court said the earlier judge applied the wrong method, not that aesthetic clinics automatically avoid VAT. The outcome still depends on the facts.

6. The Principal Purpose Test and Evidential Burden

The Upper Tribunal reaffirmed that the principal purpose test governs VAT exemption. The taxpayer must demonstrate, on the balance of probabilities, that the dominant aim of the treatment was therapeutic, diagnostic or preventative.

Evidence is central. Relevant material includes medical histories, clinical assessments, diagnostic reasoning, treatment plans, and documented outcomes. Where cosmetic benefit predominates, the exemption will fail even if some health benefit is asserted.

Scenario: Botulinum toxin administered for chronic migraine following neurological diagnosis and documented treatment failure is likely to be VAT exempt. The same product used for forehead lines without clinical pathology is not.

In plain terms: You must be able to prove you were treating a health problem, not just improving appearance.

7. Psychological and Preventive Care

The Upper Tribunal accepted that treatment of psychological disorders can constitute medical care, drawing on established authority recognising mental health as part of human health. Preventative or prophylactic interventions may also qualify, provided there is a sufficiently direct link to the prevention of illness.

However, the tribunal emphasised that general distress, dissatisfaction with appearance or reduced confidence does not, without more, amount to a recognised psychological disorder. Clinical competence to assess and evidence such disorders is essential.

Scenario: Treating a patient diagnosed with body‑focused anxiety disorder under a documented care plan may qualify. Treating normal ageing‑related dissatisfaction will not.

In plain terms: Mental health can count, but only where there is a real, recognised condition.

8. Regulatory Context and CQC Registration

The Care Quality Commission regulates activities involving treatment of disease, disorder or injury under the Health and Social Care Act 2008 (Regulated Activities) Regulations 2014. CQC registration is therefore relevant where services genuinely fall within regulated medical activity.

VAT law, however, is separate. CQC registration does not of itself confer VAT exemption, nor does the absence of registration automatically negate it. The two regimes intersect factually but operate independently.

Scenario: A CQC‑registered clinic providing cosmetic anti‑wrinkle injections without underlying pathology remains liable to charge VAT.

In plain terms: CQC status supports a medical argument but does not decide VAT on its own.

9. Treatment of Disease, Disorder or Injury

Treatments directed at recognised diseases or disorders such as hyperhidrosis, chronic migraine or temporomandibular joint dysfunction are more likely to qualify for VAT exemption. Cosmetic effects arising from such treatment are regarded as secondary.

By contrast, interventions aimed at facial lines, volume loss or age‑related changes without pathology are ordinarily cosmetic.

Scenario: Masseter injections prescribed for clinically diagnosed bruxism may be exempt. Jawline slimming without dysfunction is taxable.

In plain terms: Treat the illness, and VAT may not apply. Treat appearance, and it usually will.

10. Burden of Proof and HMRC Enforcement Practice

Across all aesthetic VAT litigation, the burden of proving entitlement to exemption rests squarely on the taxpayer. This is a long-established principle of VAT law and has been applied consistently in Illuminate Skin Clinics Ltd v HMRC, Gillian Graham t/a Skin Science v HMRC, Aesthetic-Doctor.com Ltd v HMRC, and Advanced Hair Technology Ltd v HMRC. VAT exemptions are derogations from the general rule of taxation and are interpreted strictly.

In practical terms, HMRC does not have to prove that a treatment is cosmetic. The clinic must demonstrate, on the balance of probabilities, that a particular supply falls within the medical exemption. Where evidence is equivocal or incomplete, tribunals have consistently resolved ambiguity in favour of taxation.

HMRC’s enforcement approach is holistic. Tribunals have endorsed HMRC’s entitlement to examine marketing materials, websites, social media, consent documentation, consultation templates, pricing structures and contemporaneous clinical records. Promotional emphasis on beauty, rejuvenation, anti-ageing or lifestyle enhancement is treated as strong evidence that the dominant purpose is cosmetic.

Tribunals have also accepted that inconsistencies between external presentation and clinical records can fatally undermine exemption claims. Where outward-facing materials frame treatment as aesthetic enhancement, tribunals may find asserted medical purpose lacks credibility.

Where HMRC establishes that supplies were standard-rated, it may assess for underpaid VAT, require retrospective registration, and impose interest and penalties. Partial exemption rules may further restrict the recovery of input VAT.

In plain terms: HMRC does not need to catch you out. You must positively prove exemption. Inspectors will look at your website, adverts and paperwork as well as your clinical notes. If the story does not align, HMRC can go back years and reclaim VAT, interest and penalties.

10A. Hypothetical HMRC Enquiry Walkthrough (Applying Section 10 Step by Step)

This illustrative walkthrough shows how an HMRC compliance enquiry commonly unfolds in an aesthetic clinic, and how the burden of proof and evidential analysis operate in practice. It is not a prediction of HMRC action in any individual case, but a structured model aligned with tribunal reasoning.

Stage 1: Opening enquiry and scope definition

HMRC typically requests an explanation of the business model, the services supplied, and the VAT treatment adopted. Where an exemption is claimed, HMRC will ask the clinic to identify which treatments are treated as exempt and the legal basis relied upon.

What the clinic must produce: a clear VAT position statement linked to Schedule 9, Group 7, and a treatment-by-treatment classification.

Stage 2: Evidence request and sampling

HMRC commonly selects a sample period and requests patient files for supplies treated as exempt. It will also request price lists, treatment menus, consent forms, consultation templates, and clinician credentials.

What the clinic must produce: contemporaneous records evidencing diagnosis, therapeutic purpose, treatment plan, and follow-up. Generic templates rarely suffice.

Stage 3: External presentation review

HMRC reviews websites, social media, adverts, booking pages and promotional campaigns. It assesses whether the public-facing presentation is consistent with a therapeutic purpose or whether it primarily promotes beauty, rejuvenation or anti-ageing.

What the clinic must produce: consistent patient-facing materials that do not undermine the asserted medical purpose.

Stage 4: Purpose challenge and credibility testing

HMRC will compare clinical notes with external marketing. If notes describe a treatment as “therapeutic” but marketing sells it as “refreshing lines” or “anti-ageing”, HMRC may argue that the dominant purpose is cosmetic. At this stage, the enquiry often turns on credibility and coherence across documents.

What the clinic must produce: patient-specific clinical reasoning demonstrating that the dominant purpose was the protection, maintenance or restoration of health, and that any aesthetic effect was incidental.

Stage 5: Legal analysis and provisional view

HMRC sets out a provisional technical view, often asserting that supplies are standard-rated. It may reject psychological or preventive justifications absent a recognised diagnosis, competence, and a direct link between the intervention and the disorder.

What the clinic must produce: a structured rebuttal referencing the principal purpose test, and evidencing recognised conditions where relevant.

Stage 6: Assessment, registration and penalties

If disagreement persists, HMRC may assess for underdeclared VAT, potentially require retrospective registration, and consider penalties. The scale depends on the quantum, the behaviour classification, and whether HMRC considers the position to be careless or deliberate.

What the clinic must do: obtain specialist VAT advice promptly, quantify exposure, and ensure governance systems prevent repetition.

Stage 7: Review, appeal and tribunal risk

The clinic may request HMRC review and, if necessary, appeal to the First-tier Tribunal. At the tribunal, the clinic must prove exemption on the balance of probabilities. The tribunal will examine the totality of evidence and is likely to treat inconsistencies as damaging.

What the clinic must be prepared for: 

disclosure of records, cross-examination of witnesses, and a purposive evaluation of the dominant aim of each supply.

In plain terms: 

HMRC will ask what you do, then ask for proof. They will read your website, review patient files, and test whether your clinical notes align with your marketing. If they are not convinced, they can issue a backdated bill, plus interest and penalties, and you may need to defend your position at a tribunal. In the aesthetic sector, this has resulted in substantial unexpected liabilities, sometimes exceeding the original profit derived from the treatments in question. The financial impact is compounded where partial exemption rules restrict the recovery of input VAT.

The enforcement trend also demonstrates that HMRC increasingly relies on sector‑specific litigation to inform compliance activity. Clinics operating in areas that have been the subject of adverse tribunal decisions are therefore at heightened risk of scrutiny, particularly where their business model or marketing closely resembles that criticised in earlier cases.

11. VAT Compared with Income Tax and Corporation Tax on Annual Profits

It is important to distinguish VAT liability from the taxation of annual profits under income tax or corporation tax. Although all are administered by HMRC, they arise from separate statutory regimes, apply different legal tests, and serve different fiscal purposes.

VAT is an indirect, transaction-based tax charged on individual supplies of goods or services. Liability turns on the character of each supply at the point it is made, assessed by reference to statutory exemptions and tribunal interpretation. In the context of aesthetic medicine, the critical question is whether a particular treatment constitutes VAT-exempt medical care or a standard-rated cosmetic service.

By contrast, income tax and corporation tax are direct taxes charged on net profits over an accounting period. These regimes are concerned with whether income has been properly declared, whether expenses are wholly and exclusively incurred for the purposes of the trade, and whether profits have been calculated in accordance with the relevant tax legislation. They do not require a line-by-line classification of individual treatments as medical or cosmetic.

The legal tests applied are therefore different. A tribunal decision that a treatment is cosmetic for VAT purposes does not, of itself, affect whether income from that treatment is taxable as profit. Similarly, a finding that a service constitutes medical care for VAT exemption does not create any special relief from income or corporation tax. Profits remain taxable regardless of the VAT position.

That said, there is some practical overlap in evidence. Clinical records, marketing materials and business presentations may be scrutinised by HMRC across multiple tax heads. However, the legal conclusions drawn for VAT purposes do not automatically transpose to profit taxation.

In plain terms: VAT examines each treatment and decides whether tax should be added to the price. Income and corporation tax look at the business as a whole and tax its profits. A treatment can be VAT-exempt and still fully taxable as profit.

12. Conclusion

The VAT treatment of aesthetic medicine is now underpinned by a coherent, if exacting, body of law. Taken together, the statutory framework in the Value Added Tax Act 1994, retained EU principles, and the developing line of tribunal authority demonstrate a consistent judicial approach: VAT exemption for medical care is to be construed strictly, purposively, and by reference to objective evidence.

The cases analysed in this paper, including Illuminate Skin Clinics Ltd v HMRC, Skin Science, Aesthetic-Doctor.com Ltd, and Advanced Hair Technology Ltd, show that aesthetic providers do not fail because aesthetic medicine is inherently excluded from exemption. They fail because they are unable to satisfy the cumulative legal tests applied by tribunals. In particular, they fail where there is an absence of a recognised condition, inadequate diagnostic reasoning, a dominant cosmetic purpose, or insufficient contemporaneous documentation.

The Upper Tribunal’s intervention in Illuminate is legally significant but often overstated. It does not broaden the exemption itself. Rather, it reinforces that tribunals must apply the correct analytical framework and must not treat the aesthetic outcome as determinative. The exemption remains narrow, evidence-driven, and highly sensitive to factual presentation. Clinics should therefore view the decision as a clarification of method, not a relaxation of the threshold.

From a regulatory perspective, this analysis also confirms the importance of separating VAT law from adjacent regimes such as CQC regulation. While CQC registration and compliance with treatment of disease, disorder or injury requirements may support a medical characterisation, they do not determine VAT liability. VAT follows purpose, not regulatory status, premises, or professional title.

The practical implication for aesthetic practitioners is that VAT exemption is not a matter of branding, aspiration, or professional identity. It is a legal conclusion reached only after passing a sequence of evidential and purposive tests. Clinics that genuinely provide healthcare must be able to demonstrate this at every stage of the patient pathway, from presentation and diagnosis through to treatment rationale, documentation, and external communication.

Conversely, clinics that provide cosmetic or lifestyle services should recognise that attempting to reframe such treatments as medical without substantive justification carries significant legal and financial risk. Tribunal history shows that HMRC scrutiny is detailed, retrospective, and increasingly informed by sector-specific litigation.

In summary, the law does not prohibit VAT exemption in aesthetic medicine, but it confines it to its proper scope. Where a treatment is genuinely directed at the protection, maintenance or restoration of health, exemption may apply. Where the dominant purpose is enhancement of appearance, VAT will almost invariably be chargeable. The difference lies not in the injectable used, but in the clinical reasoning, evidential discipline, and legal realism applied.

In plain terms: VAT is decided by what you are treating, why you are treating it, and how well you can prove it. If health is genuinely the reason and the records support it, VAT may not apply. If appearance is the real driver, VAT almost certainly does.

13. Future Outlook and Likely Direction of the Law

The forthcoming redetermination of Illuminate Skin Clinics Ltd v HMRC by the First-tier Tribunal is unlikely to result in a wholesale reclassification of aesthetic treatments as VAT-exempt. Based on existing authority, the most probable outcome is a nuanced decision that applies the refined analytical framework mandated by the Upper Tribunal but reaches similar substantive conclusions for many treatments.

It is likely that the tribunal will scrutinise individual treatment categories rather than issuing a broad finding. Treatments with clearly documented medical indications, such as hyperhidrosis or chronic migraine, may be accepted as exempt where evidential standards are met. By contrast, facial rejuvenation and age-related cosmetic interventions are likely to remain standard-rated.

The tribunal may also provide greater guidance on the evidential threshold required to establish psychological or preventative care as medical. However, given the consistent reluctance of tribunals to accept generalised wellbeing arguments, any such recognition is likely to be tightly constrained and limited to cases involving formal diagnosis and appropriate clinical competence.

From a wider policy perspective, continued HMRC enforcement activity is expected. The increasing volume of sector-specific litigation suggests that HMRC views aesthetic medicine as an area of compliance risk rather than uncertainty. Absent legislative reform, further clarification will continue to emerge incrementally through tribunal decisions rather than statutory amendment.

For practitioners, the forward-looking lesson is not to await judicial rescue but to assume that exemption will remain exceptional. Clinics that adopt conservative VAT positions, supported by robust clinical governance and documentation, are more likely to withstand scrutiny than those that rely on optimistic interpretations of evolving case law.

In plain terms: The courts are unlikely to suddenly declare most aesthetic treatments tax-free. Any movement will be careful and limited, and clinics should plan on the basis that VAT exemption will remain the exception, not the rule.

14. Likelihood of Legislative Intervention and Reform

Although the VAT treatment of aesthetic medicine is frequently described as a grey area, there is currently little indication that Parliament intends to intervene directly through primary legislation or targeted amendment to the Value Added Tax Act 1994. This position must also be understood in the wider context of how Parliament approaches taxation of professional services more generally, including the taxation of annual profits through income tax and corporation tax.

Historically, VAT exemptions are interpreted narrowly because they represent derogations from the general principle that consumption should be taxed. Both UK courts and the former Court of Justice of the European Union have consistently resisted expansion of VAT exemptions through judicial creativity, emphasising fiscal neutrality and legal certainty. Any legislative expansion of the medical exemption would therefore require clear political justification, Treasury support, and an acceptance of reduced VAT receipts. No such policy momentum is presently evident.

From a broader tax policy perspective, there is also little incentive for Parliament to intervene in relation to the taxation of profits generated by aesthetic practice. Income tax and corporation tax operate on a fundamentally different basis to VAT, taxing net profits rather than individual supplies. There has been no suggestion, either legislatively or in case law, that aesthetic medicine should receive preferential treatment in relation to profit taxation. Regardless of whether supplies are VAT-exempt or standard-rated, profits derived from aesthetic practice remain fully within the scope of annual taxation.

Politically, aesthetic medicine occupies an uncomfortable position. It is an expanding private sector often associated with discretionary consumer spending rather than essential healthcare provision. In that context, extending VAT exemption or introducing profit-based tax relief would be difficult to justify publicly, particularly against the backdrop of sustained pressure on public finances and the need to protect tax revenues.

The post-Brexit VAT framework affords the United Kingdom theoretical freedom to legislate independently. However, successive governments have shown caution in altering VAT exemptions, preferring administrative guidance and tribunal-led clarification over statutory reform. HMRC’s current strategy of litigating representative cases indicates an intention to shape compliance boundaries through enforcement and case law rather than invite parliamentary intervention.

It is therefore more likely that the legal boundaries governing VAT exemption in aesthetic medicine will continue to be refined incrementally through First-tier and Upper Tribunal decisions, while the taxation of profits will remain governed by existing income and corporation tax regimes without sector-specific modification. Any future legislative change is likely to be limited, tightly defined, and confined to clearly medical indications rather than aesthetic practice as a whole.

In plain terms: Parliament is very unlikely to change either VAT rules or profit tax rules to favour aesthetic treatments. VAT will keep being decided case by case by the courts, and profits from aesthetic practice will continue to be taxed in the normal way.

Appendix A: VAT Decision Tree for Aesthetic Injectables

This decision tree sets out the sequential legal tests applied by HMRC and the tax tribunals when determining whether an aesthetic injectable treatment is exempt from VAT.

1. Presenting Issue

   Is the patient presenting with a recognised disease, disorder or injury?

   • Yes → proceed to step

   • No → VAT is chargeable

   
   

2. Clinical Recognition

   Is the condition recognised within accepted medical or psychological frameworks?

   • Yes → proceed to step 3

   • No → VAT is chargeable

   
   

3. Practitioner Competence

   Is the practitioner competent and acting within scope to assess and diagnose the condition?

   • Yes → proceed to step

   • No → VAT is chargeable

   
   

4. Principal Purpose

   Is the dominant purpose of treatment the protection, maintenance or restoration of health?

   • Yes → proceed to step

   • No → VAT is chargeable

   
   

5. Treatment Rationale

   Is the intervention an accepted or rational treatment for that condition?

   • Yes → proceed to step

   • No → VAT is chargeable

   
   

6. Incidental Cosmetic Effect

   Is any cosmetic effect incidental to the therapeutic aim?

   • Yes → proceed to step

   • No → VAT is chargeable

   
   

7. External Presentation

   Do marketing materials, consent forms and patient information emphasise health outcomes rather than beauty or enhancement?

   • Yes → proceed to step

   • No → VAT is chargeable

   
   

8. Contemporaneous Evidence

   Is there clear, contemporaneous documentation evidencing diagnosis, rationale, consent and follow‑up?

   • Yes → VAT exemption may apply

   • No → VAT is chargeable

Appendix B: Red–Amber–Green VAT Risk Matrix

Green – Low Risk

• Clear diagnosis of recognised condition

• Therapeutic aim is dominant

• Robust contemporaneous records

• Minimal cosmetic marketing

Examples: chronic migraine, severe hyperhidrosis, functional neuromuscular disorders.

Amber – Moderate Risk

• Mixed therapeutic and aesthetic outcomes

• Preventative or psychological justification relied upon

• Evidence present but potentially contestable

Examples: bruxism with secondary facial slimming; anxiety‑linked dermatological conditions.

Red – High Risk

• No recognised pathology

• Appearance or ageing is the driver

• Marketing emphasises enhancement or lifestyle

• Weak or retrospective documentation

Examples: anti‑wrinkle injections, lip augmentation, facial rejuvenation.

Appendix C: Practitioner Checklist for VAT Exemption

Before treating without charging VAT, practitioners should be able to demonstrate:

• A relevant medical history

• A recognised disease, disorder or defensible preventative indication

• Diagnostic reasoning within professional competence

• A treatment plan with defined therapeutic objectives

• Evidence that cosmetic benefit is secondary

• Consent documentation reflecting medical purpose

• Follow‑up or outcome documentation

Absence of any of the above materially increases VAT exposure.

Appendix D: References

Value Added Tax Act 1994, Schedule 9, Group 7

Council Directive 2006/112/EC (Principal VAT Directive), Article 132

Health and Social Care Act 2008

Health and Social Care Act 2008 (Regulated Activities) Regulations 2014

Illuminate Skin Clinics Ltd v HMRC [2023] UKFTT (TC)

Illuminate Skin Clinics Ltd v HMRC [2025] UKUT (TCC)

Gillian Graham t/a Skin Science v HMRC [2024] UKFTT (TC)

Aesthetic‑Doctor.com Ltd v HMRC, First‑tier Tribunal (Tax Chamber)

Advanced Hair Technology Ltd v HMRC, First‑tier Tribunal (Tax Chamber) 2025

HMRC VAT Notice 701/57: Health professionals and pharmaceutical products

HMRC VAT Notice 706: Partial exemption