In a recent case between HMRC & Align Technology Switzerland GmbH and Anor, the First-Tier Tribunal allowed the appeal as they ruled that aligners, which are removable orthodontic appliances to correct misaligned teeth, were dental prostheses.

The appellants made removable orthodontic appliances that dentists use to reposition a patient's teeth. Dental professionals used advanced scanners and digital software to scan patients' mouths, and the scans were used by the appellants to make bespoke aligners. The fitting of the aligners was checked by a dentist. The aligners were worn for 20 to 22 hours every day and were changed regularly according to an agreed treatment plan, as the realignment progressed.

The appellants regarded the income from making the aligners as an exempt supply for VAT purposes, and HMRC ruled that the income should be VATable at the standard rate. The businesses appealed HMRC’s decisions.

The VAT exemption applies to the supply of dental prostheses by a person registered in the dentist’s register, the dental care professionals register, the dental care professionals register or by a dental technician. The appellants were neither dentists nor dental technicians, but they did employ dental professionals registered in the UK. The only issue in this case was whether the aligners were dental prostheses, for VAT purposes - as required before the exemption could apply.

The Tribunal took into account the ordinary meaning and the fact that the word “prostheses” was being used in the context of the provision of dental treatment, and the Tribunal concluded that dental prostheses included orthodontic appliances used to move a person’s teeth.

This case shows the complexities of establishing the correct VAT liability of products that are sold. Please contact our free helpline on 0161 477 6600 to discuss how we can assist your business in confirming the VAT liability of the products that are sold.