VAT and safety footwear might seem like a confusing and complex issue at first, because there appear to be different VAT rules for different types of footwear. Well don’t worry, because in about 3 minutes, you’ll have all the answers behind the ‘whats’ and ‘whys.’
On top of this, you’ll pick up some other interesting and helpful pieces of info on this topic from our quick and simple FAQs that will surely come in handy further down the line.
FIRST THINGS FIRST
The first important thing to consider is that VAT is a business tax imposed by the Government on goods and services bought by a customer. So, unless a company’s revenue is under a certain amount, it is legally required to pay VAT. As a result, each company and wearer in the UK must abide by the different safety footwear VAT ratings discussed in this article - and it’s definitely not a VAT cost particular to V12 Footwear!
WHAT ARE THE VAT RULES FOR SAFETY BOOTS?
However:Safety boots are not zero-rated for VAT for companies who are buying them for employees. This means a company will have to pay VAT and then reclaim it.
WHAT ARE THE VAT RULES FOR SAFETY SHOES?
Safety shoes are not zero-rated for VAT. This means that you always pay VAT on a safety shoe, whether it’s a company buying for employees or if you are purchasing a pair for yourself.
DO I STILL PAY VAT ON A SAFETY SHOE IF IT’S GOT THE SAME SPEC AS A BOOT?
Yes. A safety shoe’s specification doesn’t change the VAT rule. In other words, even if you believe your safety shoes meet the same requirements as a particular safety boot, you’ll still need to pay the VAT. This is because the VAT rule isn’t based on spec, but type of footwear. (see below for more details)
For the full Government guidance on VAT and safety footwear, click here.
WHY IS THERE A DIFFERENT VAT RULE FOR SAFETY BOOTS AND SHOES?
The zero VAT rating on safety boots is from the 1991 EU VAT rules. (see the full VAT rules and procedures document for more info here) Unfortunately, safety shoes were not included in this ruling, which means they are not exempt from VAT.
This VAT rule is known as a ‘standstill derogation,’ which means it can’t be changed or amended. So, if you’re hoping that one day safety shoes will become VAT-free like safety boots, sadly - the chances are slim.
BUT WILL THE VAT RULES CHANGE BECAUSE WE’VE LEFT THE EU?
The rules around VAT haven’t changed much due to the UK leaving the EU, and for many wearers and businesses things won’t seem different because most of the VAT changes affect importing and exporting rather than taxation within the UK. There is no indication that the zero-rated VAT rules on safety boots and shoes will change due to the UK having left the European Union.
Find out more about Brexit's impact on VAT rules in Sage’s guide ‘Brexit: The UK transition’ here.
IS A SAFETY TRAINER CLASSED AS A SAFETY SHOE?
Yes. A safety trainer is considered a type of safety shoe - this therefore means VAT is payable on it.
HOW IS A BOOT CLASSED DIFFERENTLY FROM A SHOE?
The difference between a shoe and boot all comes down to one important part of the lower limbs. A shoe covers the foot but doesn't go above the ankle, whereas according to Stitchdown, a shoe officially becomes a boot when ‘the shoe’s upper comes up over the wearer's ankle.'
(Read Stitchdown's ‘Shoe & Boot Term Dictionary’ to find out more about boot and shoe classification)