An Upper Tribunal has allowed an HMRC appeal that Invisalign aligners are not dental prostheses, and therefore should be treated as standard-rated for VAT.
The Tribunal ruled that because such aligners move natural teeth rather than replacing missing or broken teeth, they are in fact orthodontic appliances, and as such are not exempt from VAT under a rule which exempts ‘the supply of any services consisting in the provision of medical care, or the supply of dental prostheses’ by dentists or dental-care professionals.
Dental practitioners and orthodontists should continue to charge VAT at 20% on Invisalign and other similar removeable aligners, if they are registered for VAT. For any non-VAT registered practices, it is important to note that any income from aligners will represent taxable income and where that breaches £90,000 in any 12-month rolling period a compulsory VAT registration is required.
Any practice which has claimed refunds on the basis of the original First Tier Tribunal’s ruling that such aligners were exempt from VAT will need to consider corrective disclosures.