The following Value Added Tax guidance note Produced by Tolley provides comprehensive and up to date tax information covering:
This guidance note provides an overview of the conditions that must be satisfied before supplies of young children’s clothing can be zero-rated.
All of the following conditions must be satisfied before the supply can be zero-rated.
must be an article of clothing or footwear
must not be made of any fur (although there are exceptions)
must be designed to be worn by young children, and
must only be suitable for wearing by young children
Further information on all of these requirements are provided below.
An article of clothing includes the obvious items, such as shirts, skirts, trainers, etc. However it also includes certain safety items, including sailors lifejackets etc, if they have some function and form as clothing.
Articles of clothing do not include accessories, haberdashery items sold separately or safety accessories that are not items of clothing. For example:
buoyancy aids and reflective armbands
buckles, buttons, zips and other types of fastening
sew on items, patches, badges and iron-on items, etc
ear and hand muffs
Baby clothing can often cause confusion as it is possible to zero rate the following items providing they are held out for sale correctly (this list is not exhaustive):
bibs including plastic bibs with built in trays
hooded pushchair rain covers that can be worn by the baby as a rain cape
disposable / re-usable nappies and nappy liners
padded sleeping garments that are shaped at the neck and armholes or have sleeves and / or legs, and
towelling bathrobes that have a hood or sleeves that enable the baby to be wrapped in the garment
HMRC has stated that the following items cannot be zero-rated as baby clothing (this list is not exhaustive):
hooded pushchair covers that are not designed to be used as a baby rain cape
disposable nappy material that is supplied on a roll and not already cut out
mother and baby shawls that can be used by both individuals
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