The Finance Act 2015 added two new sections, 33C and 33D, to the VAT Act 1994 with effect from 1 April 2015, enabling the refund of VAT relating to non-business activities carried out by palliative care charities (mainly hospices).

The refund covers charities whose main purpose is the provision of palliative care under supervision of a medical professional to persons who are in need of such care because they have a terminal illness. Terminal illness means a progressive disease which will result in a person’s death. This will mainly cover adult and children’s hospices:

Unlike with search and rescue charities and medical courier charities this category does not include charities whose main purpose is to support palliative care charities (for example, fundraising charities) – neither does it include charities whose main purpose is to provide trained nurses to palliative care charities

Hospice UK has also published a detailed Q&A on the VAT refund scheme for hospices.