The Commissioners for HMRC v Align Technology Switzerland GmbH & Anor

An undefined VAT exemption term is construed by its ordinary meaning, context and purpose, but those considerations cannot extend the exemption beyond the words used. The expression ‘dental prostheses’ in Group 7 covers artificial items that replace missing or damaged teeth. It does not include orthodontic aligners that reposition existing teeth, even where they are bespoke health-related products.

The Commissioners for His Majesty’s Revenue and Customs (HMRC) appealed the First-tier Tribunal’s decision in Align Technology Switzerland GmbH and Align Technology BV v HMRC ([2025] UKFTT 462 (TC)), which had allowed the respondents’ appeal against HMRC’s decision that supplies of Invisalign clear aligners were standard-rated for VAT. The respondents, collectively Align, supplied bespoke removable appliances used by dental professionals to reposition patients’ teeth. The permitted ground alleged that the FTT had erred in construing ‘dental prostheses’ in Items 2 and 2A of Group 7 of Schedule 9 to the Value Added Tax Act 1994. Align argued that whether the aligners fell within the ordinary meaning of the expression was a factual question reviewable only under the Edwards v Bairstow standard. The central issues were the Upper Tribunal’s jurisdiction and whether the aligners were dental prostheses.

HMRC’s appeal was allowed. The FTT’s decision was set aside and remade as a decision dismissing Align’s appeal against HMRC’s decision that the aligners were chargeable to VAT.

1. Jurisdiction. The proper construction of statutory words is a question of law, even when the words are ordinary English. The appeal raised rival constructions of ‘dental prostheses’, so the Upper Tribunal could determine the correct meaning without finding that the FTT’s construction was one no reasonable tribunal could reach. A Taxpayer v The Commissioners for His Majesty’s Revenue and Customs ([2025] EWCA Civ 106) concerned the factual assessment of whether found circumstances met an ordinary expression, not rival statutory constructions. Where the correct construction leaves a factual question about whether found facts fall within the statutory words, the Edwards v Bairstow standard may still apply.
2. Meaning of ‘prosthesis’ and ‘dental prostheses’. Dictionaries were aids to construction, not answers detached from context. A prosthesis is an artificial replacement for a missing or malfunctioning body part which performs or assists the relevant bodily function. The addition of ‘dental’ confines the expression to prostheses that replace missing or broken teeth and perform their function. The reasoning in Perry v Adjudication Officer ([1999] NI 338) was compelling on the distinction between a prosthesis and other artificial aids. The relevant reasoning in Carden v Pickerings Europe Ltd ([2005] IRLR 723) was not part of that judgment’s ratio, but was also persuasive on the distinction.
3. Context and purpose. The exemption’s purpose is to prevent health-related supplies becoming inaccessible because of VAT costs. But the exemption covers specified supplies, not every health-related product. Strict construction does not mean depriving an exemption of its intended effect, but purpose and fiscal neutrality cannot override or enlarge the statutory wording. The VAT Committee Guidelines and the Commission services’ Working Paper were admissible aids to interpretation, but carried limited, non-zero weight. They provided additional support for the distinction between dental prostheses and dental devices such as aligners.
4. Order. The Upper Tribunal concluded that the aligners did not replace missing or damaged teeth and were outside the exemption in Items 2 and 2A of Group 7 of Schedule 9 to the Value Added Tax Act 1994. No further evidence or findings were required. The FTT decision was set aside and remade to dismiss Align’s appeal.

• Upper Tribunal (Tax and Chancery Chamber): allowed HMRC’s appeal, set aside the FTT decision and remade it to dismiss Align’s appeal ([2026] UKUT 256 (TCC) ).
• First-tier Tribunal (Tax Chamber): allowed Align’s appeal against HMRC’s decision that supplies of the aligners were standard-rated (Align Technology Switzerland GmbH and Align Technology BV v HMRC, [2025] UKFTT 462 (TC)).