As with anything financial, you have to consider the tax implications of health insurance. It can be tricky trying to understand the ins and outs of tax and how they apply or do not apply to certain products and services. Health insurance and VAT is no different. Whether you have had health insurance for a while, and are starting to wonder what the tax implications are, or if you are considering health insurance for the first time, this short guide should help clear up any queries you have in regard to health insurance and VAT.
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Health insurance VAT exempt
Like other forms of insurance, Health insurance is VAT exempt, meaning that the cost of your premiums will not incorporate value added tax,health insurance prices and you will not have to pay it. Also exempt from VAT are many of the doctors and hospital services that may be provided to you under the cover that you have chosen. Such services include vision testing and eye examination, hearing tests, osteopathic and chiropractic treatments, and nursing care that is provided in the patient’s home. Whether or not you would receive these services under the cover you have will depend upon the policy you have taken out with your health insurance provider.
Is health insurance vatable?
Value added tax is a tax that is usually charged on products or services. Health insurance is not vatable, meaning that you will not be charged VAT on your health insurance premiums when you pay them. There is an Insurance Premium Tax which may be applicable instead of VAT, but there is no value added tax on health insurance policies. If you are self-employed you will not be able to claim back VAT on any health insurance policies, such as health insurance working abroad.