VAT on take-away food and drink - What are the rules?
Food supplied in the course of catering
You must always standard-rate food supplied in the course of catering, including hot take-away food.
Food not supplied in the course of catering
Although the supply of most food and drink of a kind used for human consumption is zero-rated, there are exceptions. Some items are always standard rated and these are explained in Notice 701/14 Food (see HMRC website). Other supplies are standard rated because they are made in the course of catering.
What is the liability of take-away food and drink?
Hot take-away food that has been heated for the purposes of supplying it hot is always standard-rated. Cold take-away food and drink is zero-rated, provided it is not of a type that is always standard-rated (such as crisps, sweets, beverages and bottled water).Hot drinks are standard rated.
What does ‘hot’ mean?
Hot in this context means above the surrounding air temperature.
Examples of standard-rated sales when sold hot are:
- baked potatoes with a hot or cold filling
- hot dogs and hamburgers
- pies, rolls, sausage rolls, pasties and similar
- items toasted sandwiches
- cups of tea, coffee, chocolate and other hot drinks
- cups of soup
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