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HMRC internal manual

VAT Food

Excepted items: catering: secondary catering issues: supplies of meals to the family

Schedule 4 of the VAT Act 1994 provides that where goods purchased by a business are disposed of for no consideration there is a supply of goods; and where an individual applies such goods to personal use, then it is a supply in the course or furtherance of that business.

Thus when the proprietor of a restaurant, cafe or other catering business supplies meals for himself/herself and his/her family, there is a taxable supply of goods.

However, we regard the supply as one of food rather than one of catering, and the amount of VAT payable will depend on whether the goods are zero or standard-rated foodstuffs. Most meals will be made up of zero-rated items, but you should ensure that tax is accounted for on all standard-rated items, such as alcoholic drinks, soft drinks, crisps and nuts, ice cream, confectionery and chocolate. The tax value of these goods is the cost of purchase at the time of supply.