Commentary

V16.1003 VAT—sports nutrition drinks

Part V16 Forms and other HMRC material

V16.1003 VAT—sports nutrition drinks

V16.1003 VAT—sports nutrition drinks

Information Sheet 15/12, August 2012

1 Introduction

1.1 Who should read this Information Sheet?

Manufacturers and retailers of ready to drink sports nutrition drinks and syrups, concentrates, essences, powders, crystals or other products that are used to make sports nutrition drinks.

1.2 What is this information Sheet about?

It provides guidance on how to establish the correct VAT liability of sales of sports nutrition drinks following the changes announced at Budget 2012.

1.3 When do the changes take effect?

The changes affect sales of sports nutrition drinks made on or after 1 October 2012.

1.4 Why have these changes been introduced?

Beverages are liable to VAT as an excepted item (item 4) to the VAT food zero rate. Many sports drinks are beverages for VAT purposes and are therefore standard-rated but the courts have found that some sports drinks are not beverages because of their nutritional content and are therefore zero-rated. These changes ensure that all sports drinks are taxed in a similar way ensuring that there is consistent treatment of sports drinks whether consumed for rehydration or nutritional purposes.

2 VAT liability of sports nutrition drinks

2.1 What are the current rules (prior to 1 October 2012)?

Most sports drinks are beverages (designed to rehydrate, quench thirst or give pleasure), which means that they are standard-rated for VAT under excepted item 4 to the VAT zero rate. However, some sports drinks are zero- rated because the Courts found that they were not beverages due to their high nutritional content. These are known as sports nutrition drinks.

2.2

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