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HM Revenue and Customs Brief 19/11


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Issued on 01 April 2011

This Brief confirms HMRC's view of the VAT treatment of supplies of hot food made in the course of catering. It has been issued following the European Court of Justice (ECJ) judgment in the joined German cases of C- 497/09, C-499/09, C501/09 and C-502/09 (Manfred Bog and others).


The ECJ ruled that the supply of food or meals freshly prepared for immediate consumption from snack stalls, mobile snack bars or in cinema foyers is a supply of goods within the meaning of Article 5 of the Sixth VAT Directive if a qualitative examination of the entire transaction shows that the elements of supply of services preceding and accompanying the supply of the food are not predominant. This is unlike the activities of a party catering service which are supplies of services within the meaning of Article 6 except in cases in which a party catering service does no more than deliver standard meals without any additional elements of supply of services.

Furthermore, the ECJ has held that the term 'foodstuffs' in category 1 of Annex H to the Sixth Directive 77/ 388, as amended by Directive 92/111 (now category 1 of Annex 111 to the VAT Directive 2006/112), must be interpreted as also covering food and meals which have been prepared for immediate consumption by boiling, grilling, roasting, baking or other means.

The significance of the decision for German taxpayers is that certain supplies of hot food may now be eligible for the reduced rate.

HM Revenue & Custom's(HMRC) position

The UK treats most basic supplies of foodstuffs as zero rated but along with other specified items there is a specific exclusion from the zero-rate for supplies made in the course of catering. The Law (Note 3, Group1, Schedule 8, VAT Act 1994) goes further to specifically legislate for certain supplies of food that are for consumption on and off premises including the supply of hot food.

Article 110 of the VAT Directive 2006/112 allows the UK to retain its zero-rate for food as long as there are clearly defined social reasons and the supplies are for the benefit of the final consumer. There can be no extension to the zero-rate provisions and the Courts have determined that exemptions (including zero rating) must be construed strictly, but exceptions from the exemption (including Note 3) should not be construed restrictively.

The zero rating provisions form a specific legal framework and subject to the conditions of the derogation the UK has discretion as to what supplies fall within those provisions. Since the UK has specifically legislated to exclude supplies of hot food it is clear that the intention was not to include such supplies within the zero-rate.


HMRC considers that the ECJ judgment has no implications for the UK treatment of supplies of hot food and businesses should continue to treat their supplies in accordance with published guidance.

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Article Published/Sorted/Amended on Scopulus 2011-04-03 19:55:16 in Tax Articles

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