Hot takeaway drinks are standard-rated (or temporarily reduced rated as long as they are non-alcoholic). Further information can be found in Food products (VAT Notice 701/14).
Does the VAT reduction apply to takeaways?
Takeaway: If it is hot food or a hot drink being sold, and it is not alcoholic, it is subject to 5% VAT – otherwise the 20% rate will apply.
What is the VAT rate on a takeaway meal?
zero rate
The supply of cold takeaway food is liable to VAT at the zero rate. Chilled, cold or frozen cooked meals are liable to VAT at the zero rate.
Do you pay tax on hot food?
Under long-standing VAT legislation, sale of most foods bought to eat or cook at home is zero-rated for VAT, meaning that no tax is charged. By contrast, meals bought and consumed in a restaurant, and hot take-away food or drink, are charged at a standard 20% tax rate.
What food items have VAT on them?
Most food is VAT-free but you do pay VAT on some food. Some items for human consumption are standard-rated. This includes catering, alcoholic drinks, confectionery, crisps and savoury snacks, hot food, sports drinks, hot takeaways, ice cream, soft drinks and mineral water.
What food items are VAT exempt?
You can zero rate all supplies of unprocessed foodstuffs such as:
- raw meat and fish.
- vegetables and fruit.
- cereals, nuts and pulses.
- culinary herbs.
When do I have to pay VAT on hot takeaway food?
From 15 July 2020 to 31 March 2021, certain supplies of catering and hot takeaway food that would normally be taxable at the standard rate of VAT, will be liable to the reduced rate of 5%.
What is the temporary 5% VAT rate for hospitality?
VAT notice 709/1 has been updated to reflect legislative changes that temporarily introduce a 5% reduced rate on supplies of: Hot and cold food for consumption on the premises on which they are supplied Hot and cold non-alcoholic beverages for consumption on the premises on which they are supplied
When do the new VAT rates come into effect?
The Chancellor of the Exchequer announced on 24 September 2020 that the temporary reduced rate for tourism and hospitality will be extended to 31 March 2021. This cut in the VAT rate from the standard rate of 20% will have effect from 15 July 2020 to 31 March 2021.
How are delivery charges related to hot takeaway?
In principle, delivery charges are ancillary to the supply of hot takeaway food and will follow the same liability of the primary supply (so reduced rated). However, additional charges such as commissions charged by third parties are not considered to be ancillary to a supply of hot takeaway food and will be subject to the standard rate.
