But food and drink are usually standard rated for VAT when provided as part of a catering service. Meals and drinks served hot or consumed in a cafe or restaurant are often standard rated. But some cold or takeaway food and drinks can be zero rated. There are lots of exceptions.
Is there VAT on restaurant food in UK?
A 5% rate of VAT applies to supplies of: Food and non-alcoholic beverages sold for on-premises consumption, for example, in restaurants, cafes and pubs. Hot takeaway food and hot takeaway non-alcoholic beverages.
Do you charge VAT on restaurant food?
Most food is VAT-free but you do pay VAT on some food. Some items for human consumption are standard-rated. … Restaurants and takeaways must also charge VAT on all hot takeaways or home deliveries. They don’t need to charge VAT on cold takeaway food unless it is to be eaten in a specific place.
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.
Do you have to pay VAT on takeaway food?
In a nutshell restaurants must always charge VAT on everything except food that is cold and taken away, takeaway vendors do not need to charge VAT unless the food is hot and/or the customer would like to eat in perhaps a designated sitting area.
Is client entertaining VAT exempt?
HMRC only allows tax relief and the claiming of VAT on the cost of entertaining your business’s employees. … If you’re entertaining anyone else, that counts as business entertainment rather than employee entertainment, and you can‘t claim either tax relief or VAT on the cost of entertaining them.
Is food VAT exempt or zero rated?
Although food and drink is often zero-rated for VAT, there are many exceptions where the standard rate applies instead. These include: catering and hot food (including hot takeaways) snacks such as crisps, confectionery and ice cream.
What is the 2/3 rule for VAT?
Two Thirds Rule
If a combination of goods and services is supplied for a single price, provided the value of goods exceeds two-thirds of the total price for the job, the entire transaction is treated as a supply of goods (not a service).
Is VAT being reduced?
General description of the measure. The government announced on 8 July 2020 that it intended to legislate to apply a temporary 5% reduced rate of VAT to certain supplies relating to hospitality, hotel and holiday accommodation and admission to certain attractions.
Can I claim VAT on food and drink?
So, you can only claim VAT on subsistence when your employees are working away from their usual place of work – not for every food and drink expenses they incur.