Zero rating on clothing for young children

The taxpayer produced a fleece for children. It was a rectangular piece of micro fibre with sleeves and was intended for indoor wear. HMRC said it was not an item of clothing and therefore could not be zero rated. It claimed the garment was in effect a blanket and could not be worn properly because its length was a ‘tripping hazard’.

The taxpayer explained that the intention was for the garment to be wrapped around the body to provide warmth and protection. It had been designed to be worn and would fit a child rather than a bed.

The First-tier Tribunal said for an item of clothing to qualify for zero rating it had to have been designed as such. It was not enough simply to say the garment had been designed to be worn; it had to have objective characteristics to establish it was intended as...