In its ruling of 3 September 2015 (case no. 16 K 340/12), the Fiscal Court (Finanzgericht, FG) of Lower Saxony held that laboratory tests ordered by therapists and performed in the course of practising a medical or quasi-medical profession (i.e. healing professions, such as non-medical practitioners) are exempt from VAT under § 4 No. 14 a sentence 1 of the German VAT Act. An appeal is already pending before the Federal Fiscal Court (Bundesfinanzhof, BFH) under case no. V R 25/16.
The plaintiff's corporate purpose was the performance and development of laboratory diagnostics. It carried out tests on the basis of a laboratory order issued by the respective patient.
The tests performed constituted services that had been ordered by the respective therapist; the plaintiff had also documented this sufficiently. A random sample of therapists was selected, and their written statements confirmed the orders.
The plaintiff invoiced the laboratory services to the patient.
In addition, the plaintiff's laboratory services were provided in the course of practising a medical or quasi-medical profession, as the persons acting on behalf of the plaintiff all held the respective professional qualifications, which is a prerequisite for such services being tax-exempt.
Source: FG Niedersachsen
Frequently asked questions
Frequently asked questions
Are laboratory tests ordered by therapists exempt from VAT?
According to the ruling of the Finanzgericht Niedersachsen of 03.09.2015 (Az. 16 K 340/12), laboratory tests ordered by therapists as part of a medical or quasi-medical healing profession (e.g. Heilpraktiker) are exempt from VAT pursuant to § 4 Nr. 14 a sentence 1 UStG. However, the decision is not yet final, as an appeal is pending before the BFH under Az. V R 25/16.
What requirements must laboratory services meet to qualify for the VAT exemption under § 4 No. 14 a UStG?
The laboratory services must be performed in the course of practicing a medical or paramedical profession. The individuals providing the services must hold the relevant professional qualifications, and the services must be ordered by a therapist. In addition, these orders must be sufficiently documented.
How must the ordering of laboratory tests by therapists be documented?
The laboratory operator must sufficiently document the therapeutic order. In the disputed case, the plaintiff had recorded the orders in writing; for verification, several therapists were selected at random, and their written confirmations substantiated the orders.
Does the way the laboratory service is billed to the patient affect the tax exemption?
In the case decided, the laboratory billed the patient directly, which did not preclude the VAT exemption. What matters is that the service is therapeutically ordered and provided by suitably qualified personnel within the scope of a medical profession.
What is the case number of the pending appeal before the BFH on laboratory tests?
The appeal against the ruling of the FG Niedersachsen of 03.09.2015 (Az. 16 K 340/12) is pending before the Bundesfinanzhof under case number V R 25/16. Until the BFH issues its decision, a certain degree of legal uncertainty remains in comparable cases.