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Customs news - Hot take-away food

16 October 2002
Issue: 3879 / Categories:

Customs have issued a Business Brief clarifying their policy on the treatment of hot take-away food, on which there has been no change.

Most foodstuffs are zero rated for VAT purposes. But hot take-away food and drink is standard rated, whether sold from a traditional take-away, supermarket or any other outlet. Standard rating applies irrespective of the customer's intention, the place of consumption or whether the goods are collected or delivered.

Customs have issued a Business Brief clarifying their policy on the treatment of hot take-away food, on which there has been no change.

Most foodstuffs are zero rated for VAT purposes. But hot take-away food and drink is standard rated, whether sold from a traditional take-away, supermarket or any other outlet. Standard rating applies irrespective of the customer's intention, the place of consumption or whether the goods are collected or delivered.

Food that is heated in cooking, re-heated or stored hot, is supplied hot or warm, and is to be eaten hot or warm, is standard rated. This is because the supplier intends that the customer eat the food hot.

Hot food can only be zero rated if the reason it is supplied hot is that it is freshly cooked, and is not supplied for the purpose of being eaten hot, for example newly baked bread.

In some cases suppliers have stated that they are indifferent to the temperature at which their customers eat the food, but have other reasons for displaying food for sale hot, and have successfully argued their case before the tribunals and courts. Chips, hot dogs and baked potatoes are always standard rated. Other relevant aspects include:

* type of outlet - if advertised as a take-away food outlet, supplies of hot food will be standard rated;

* conditions of storage and sale - if the food is kept hot solely to comply with hygiene regulations, this is possibly an indicator of zero rating;

* palatability - if an item is generally accepted to be unpalatable when cold, this would be an indicator for standard rating;

* type of packaging used - if food is packaged to retain heat, this may point towards standard rating;

* availability of condiments, napkins and utensils - this would be an indicator for standard rating.

(Source: Customs Business Brief 26/2002 dated 2 October 2002.)

Issue: 3879 / Categories:
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