New hospitals and the need for effective capital planning
25 November 2020
In October, the Prime Minister, Boris Johnson, confirmed that forty hospitals would be built by 2030, as part of a funding package worth £3.7billion.
This funding will sit alongside the previously announced share of £850million to be split between 20 hospitals to upgrade outdated facilities and equipment, with enabling works already beginning at several sites, and the £1.5billion announced over the summer for further capital funding, of which £450million was to be allocated to 142 A&E upgrades ahead of winter to improve infection control and increase capacity in the midst of the coronavirus pandemic.
When detailing the additional funding, Prime Minister Boris Johnson said: “The dedication and tireless efforts of our nurses, doctors and all healthcare workers have kept the NHS open throughout this pandemic. But no matter what this virus throws at us, we are determined to build back better and deliver the biggest hospital building programme in a generation.
“From Morpeth to Milton Keynes, we are building 40 new hospitals across England to level up our NHS so more people have top-class healthcare services in their local area.”
Effective VAT planning to maximise investment on projects such as new site builds, refurbishments and other capital projects was the topic at the forefront of Liaison Financial’s recent webinar: NHS VAT Planning for High Value Capital Projects. The business’ Head of Tax Services, Kenny Lee, discussed the current rules regarding zero rating and VAT recovery, as well as optional rules including option to tax and direct attribution. Touching on potential future changes, Kenny also looked at the possible effects of the Domestic Reverse Charge and COS Reforms, before answering individual questions based on capital projects taking place or planned at the trusts present.
Discussing the issues facing trusts in planning capital projects, Kenny said: “Capital projects are essential for ensuring the ongoing growth and development of the NHS, and that is especially pertinent when considering projects which fall under this new funding which are now more important than ever before in the aftermath of COVID-19. Effective VAT planning at the outset of such a project is vital and we always recommend speaking to an expert for advice when scoping any capital-based projects.”
To find out more or discuss an upcoming capital project, please speak to one of Liaison Financial’s VAT experts at [email protected], or telephone our NHS VAT Helpline on 0800 700 652.
To join future webinars covering a variety of VAT-based subjects specifically for the NHS, please see our Webinars page.
The Prime Minister’s full announcement can be found here: https://www.gov.uk/government/news/pm-confirms-37-billion-for-40-hospitals-in-biggest-hospital-building-programme-in-a-generation