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Written question asked by Tom Gordon (Liberal Democrat) on Wednesday, 17 June 2026, in the House of Commons. It was due for an answer on Monday, 22 June 2026 (named day). It was answered by Dan Tomlinson (Labour) on Monday, 22 June 2026 on behalf of the Treasury.

Respite Care: VAT

Question

To ask the Chancellor of the Exchequer, what assessment she has made of the potential impact of VAT on the affordability of respite day care services; and what assessment she has made of the adequacy of the reasons for the difference in VAT treatment between respite day care services and residential care homes.

Answer

Supplies of welfare services, including the provision of respite and residential care for people with permanent disabilities and dementia, are exempt from VAT if they are supplied by eligible bodies, such as public bodies or charities.

Some respite care may be provided by community interest companies (CICs). Because CICs are not charities in law, they must meet the criteria of being state-regulated in order to provide VAT-exempt care services. This is to ensure that the VAT relief is carefully targeted at private providers offering safe and high-quality welfare services.

The Government recognises that there are private organisations that bring value to the care sector without being regulated, but extending the VAT relief to include these would have to be carefully balanced against the risks that it poses.

Secondary information

Type
Written question
Reference
10791
Session
2026-27
Subjects
Care homes Finance VAT Respite care
Link
View this Written question on www.parliament.uk