|HMRC Reference:Notice 701/18 (June 2011)||View Change History|
This notice cancels and replaces Notice 701/18 (March 2002).
This notice explains:
This notice and others mentioned are available both on paper and on our Internet website at www.hmrc.gov.uk.
Manufacturers, wholesalers and retailers of sanitary protection products, including those responsible for accounting for VAT on sales made from vending machines.
The reduced rate applies to the supply of any sanitary protection product that is designed and marketed solely for the absorption or collection of menstrual flow or lochia (discharge from the womb following childbirth). Examples include:
If you are a retailer or a distributor and you are in any doubt whether a product is designed solely for the absorption or collection of menstrual flow or lochia, you should contact the manufacturer of the product for clarification.
The reduced rate does not apply to any product that is not designed and marketed solely for the absorption or collection of menstrual flow or lochia. Items that do not qualify for the reduced rate include:
Panty liners designed for sanitary protection, but marketed as also suitable for protection against light incontinence or light feminine discharges, are eligible for supply at the reduced rate. Panty liners designed primarily as incontinence products are not eligible for the reduced rate, but may qualify for a separate VAT relief (see paragraph 2.4).
Incontinence pads are not eligible for sale at the reduced rate under this relief. Incontinence pads and other specially designed incontinence products (including clothing) may qualify to be zero-rated under a separate relief. Further details can be found in Notice 701/7 VAT Reliefs for disabled people.
No. Items of clothing, such as disposable or protective pants or briefs that either hold sanitary protection in place or protect the wearer from leakage, are not eligible for the reduced rate. Certain items of children’s clothing may be zero-rated under a separate relief. Notice 714 Zero rating young children’s clothing and footwear provides further details.
If you manufacture or distribute sanitary protection products, you should ensure that your accounting systems can distinguish between goods sold at the standard and reduced rates of VAT. Separate summary totals should be produced for supplies at each VAT rate, and these totals should be posted to your VAT account. Detailed guidance on record keeping and the VAT account can be found in VAT Notice 700 The VAT Guide.
Retailers are required to use one of the VAT retail schemes to calculate the value of their supplies at each rate of VAT. Detailed guidance on retail schemes can be found in the following notices:
The relevant notice for each retail scheme contains a step-by-step guide to calculating the VAT that has been charged on any reduced rate sales.
If you need to calculate the VAT included within a price, you can do this by applying the appropriate ‘VAT fraction’ to the total tax inclusive price. The relevant VAT fractions are detailed below:
Rate of VAT
Goods sold at the standard rate of VAT (20%)
Goods sold at the reduced rate of VAT (5%)
If you operate machines that dispense products at different rates of VAT and are unable to identify your total sales at each rate, you should apportion your sales income using a fair and reasonable method. You may, for example, calculate the sales at each rate of VAT with reference to the number of refills made for each item within the relevant period. Where appropriate, you should agree an apportionment method with your Local Business Advice Centre. Further details concerning methods of apportionment can be found in VAT Notice 700 The VAT Guide.
Your Charter explains what you can expect from us and what we can expect from you. For more information go to Your Charter.
If you have any comments or suggestions to make about this notice, please write to:
HM Revenue & Customs
VAT Liability Team
100 Parliament Street
Please note this address is not for general enquiries.
For your general enquiries please phone our Helpline 0300 200 3700.
If you are not satisfied with our service, please let the person dealing with your affairs know what is wrong. We will work as quickly as possible to put things right and settle your complaint. If you are still unhappy, ask for your complaint to be referred to the Complaints Manager.
For more information about our complaints procedures go to www.hmrc.gov.uk and under quick links select Complaints.
HM Revenue & Customs is a Data Controller under the Data Protection Act 1998. We hold information for the purposes specified in our notification to the Information Commissioner, including the assessment and collection of tax and duties, the payment of benefits and the prevention and detection of crime, and may use this information for any of them.
We may get information about you from others, or we may give information to them. If we do, it will only be as the law permits to:
We may check information we receive about you with what is already in our records. This can include information provided by you, as well as by others, such as other government departments or agencies and overseas tax and customs authorities. We will not give information to anyone outside HM Revenue & Customs unless the law permits us to do so. For more information go to www.hmrc.gov.uk and look for Data Protection Act within the Search facility.
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