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HMRC internal manual

VAT Food

Items benefiting from the relief: what is food?: food packaging: packaging which serves the supply

Following the Simmers decision (VFOOD2860), we have adopted the courts’ concept of serving the supply of the food as the test of whether packaging must be regarded as separate from the food which it contains. Packaging which amounts to no more than the usual method by which a supplier purveys his food product to a particular market, even if this is more elaborate than the minimum strictly necessary, is regarded as serving the supply of the food, so that packaging and food are a single zero-rated supply.

Packaging which is clearly designed to be an extra to the food, and to be retained by the purchaser for future use, is considered to be more than is required to serve the supply of the goods, and is to be treated as a separate supply with VAT charged accordingly. This can be the case with packaging which has a secondary use (such as cups and glasses) or which is itself reusable (such as biscuit barrels).

The main types of packaging which create difficulties are described in VFOOD2900, VFOOD2920, VFOOD2940 and VFOOD2960.