Supplies of catering and takeaway food

By Tolley

The following Value Added Tax guidance note by Tolley provides comprehensive and up to date tax information covering:

  • Supplies of catering and takeaway food
  • Course of catering
  • Schools and colleges, etc
  • Hospitals, etc
  • Premises
  • Hot takeaway food
  • Accounting for VAT
  • Meals provided free of charge

This guidance note provides an overview of the VAT treatment of supplies of catering and takeaway food.

VFOOD4200 VATA 1994, Sch 8, group 1, note (3)(b)

The following types of supplies are liable to VAT at the standard rate unless they are supplied at a hospital, school or other similar establishment as these may be exempt from VAT:

  • supplies made in the 'course of catering'
  • food and beverages supplied and the customer consumes the food whilst on the premises, and
  • food / beverages that are treated as hot takeaway food
Course of catering

Catering is the supply of prepared food and drink and it usually involves a significant element of service being provided to the customer. Supplies made in restaurants, at weddings and the delivery of cooked meals to the customer's house are typical examples of supplies of catering.

VATA 1994, Sch 8, group 1(a)

Food and drink supplied as part of a catering contract will also be liable to VAT at the standard rate.

However, it should be noted that the provision of retail or catering space to a catering business will not automatically be treated as the standard rated supply of catering. If the business receives a licence to occupy land then this will be exempt from VAT unless the supplier has opted to tax the property. Please see the Overview of VAT and property issues and Overview of the option to tax guidance notes for more information.

If the business supplies food that the customer must prepare before it can be consumed, the supply will not be treated as a supply of catering. Preparation includes:

    More on Zero-rated supplies: