HMRC have confirmed to the HBSA that a wig supplier does not need to charge VAT on a ‘Top Up’ payment when an NHS trust makes a part payment towards the supply of a wig and the customer pays the difference.

Technically, once a wig has been supplied to the end user the NHS does not retain any ownership of the wig. The recipient, who may be chronically sick, is the end user of the product and therefore within HMRC guidelines should not have to pay any VAT on any ‘Top Up’ payment made.

For clarity, all wig suppliers should still charge VAT to the NHS Trusts on the proportion that they pay, and all invoices should reflect this. Records of the cost of the wig and the VAT charged for each case, showing the NHS payment and the payment by the individual should be kept by each supplier.