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HMRC internal manual

VAT Food

Hot and cold take-away food: supplies of hot food by supermarkets

Prior to the 2012 changes to VAT law the fact that supermarkets were primarily recognised as grocery retailers rather than caterers inevitably afforded them greater scope to argue that they did not supply hot food for the purpose of enabling it to be consumed before it has cooled to ambient temperature. However, supplies of hot food by supermarkets were still subject to the same rules (the old ‘purpose’ test) as those of any other supplier, and the general approach to determine liability was the same as that detailed above.

On the basis of the tribunal decisions in Lewis’s Group Ltd (see VFOOD4300 and the similar case of Stewarts Supermarkets Ltd (BEL 93/60A), we normally accepted that hot meat products, sold from ‘hot deli’ or ‘rotisserie’ counters within larger grocery stores, can be zero-rated, subject to all of the conditions below being met.

This only applies to traditional rotisserie products (such as cooked chicken, joints of meat, and sausages) and does not apply to other hot food items such as pasties and chips, which should be considered against the criteria in other parts of this guidance.

The conditions prior to the 2012 changes were:

  • the food is not held out for sale in any way that would suggest that it is intended to be eaten whilst still hot;
  • it does not form part of a ‘meal deal’ and is not sold with chips, baked potatoes or other items that suggest that the overall supply is one of a meal;
  • there is no evidence of any intention by the supplier to facilitate consumption of the product whilst still hot (such as provision of napkins, cutlery, condiments, heat retentive packaging);
  • there are no separate checkout facilities for purchases from the counter, and no evidence that the counter has been positioned close to the exit to help facilitate immediate consumption of the product.

Following the introduction of the 2012 changes to the VAT law supermarkets, in the same way as all other retailers of hot food must consider whether any of the 5 new tests are met. If one or more of the tests are met their hot food will be standard-rated.