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Businesses Could Take a Bite Out of New Fast Food VAT Ruling!

Thomas Westcott are urging local businesses supplying fast food to obtain further advice following a recent European VAT ruling regarding what constitutes a supply of food (which may  be zero-rated) and what constitutes a supply of "catering", which is subject to VAT in the UK. 

David Pegg, Thomas Westcott's VAT Partner and Specialist Consultant, is offering advice and an initial consultation to businesses confused as to how this potential change will affect them. 

David said "The VAT rules in the UK can be complicated and confusing for businesses, and a significant number of our clients within the food and drink sector are seeking clarification as to whether VAT should or should not be payable."

He added: "The European Court has cast doubt over the UK's VAT treatment of hot take away food.  It has ruled that where food is supplied for immediate consumption there is no supply of catering, simply a supply of food, which should not be subject to the standard rate of VAT (and may be zero-rated in the UK). In addition, it ruled that a supplier who only provides very limited facilities to enable a customer to consume a meal on their premises is also not making a supply of catering but a supply of food, and again some or all of the supply may be zero-rated in the UK."

There is the potential to make claims for VAT overpaid covering the last 4 years, but each case must be considered on its own merits as H M Revenue and Customs has announced that it does not consider that the European case impacts upon the UK's VAT position. 

For further advice contact David Pegg at Thomas Westcott on 01392 288555, or by email at david.pegg@thomaswestcott.co.uk.