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VFOOD6200 - Excepted items: Confectionery: The bounds of confectionery, sweets, chocolates, chocolate biscuits, cakes and biscuits: The borderline between confectionery and cakes

Cakes, whether or not covered with chocolate, are excluded from the terms of excepted item 2, and are therefore zero-rated as food. Cakes includes sponge cakes, fruit cakes, pastries, éclairs, meringues and jaffa cakes. Though there is no accepted definition of the word, cakes often made from a thin batter containing flour and eggs, and aerated in the process of cooking.

In most cases, the borderline between cakes and confectionery causes few problems, but there are products whose status ascakes is not self-evident. They will normally be marketed as cakes, through bakeries and supermarkets rather than through confectionery outlets, and will be displayed with cakes and biscuits rather than in the confectionery section. The style of packaging used will also normally follow the pattern for bakery products, with a number of individual portions boxed and cellophane wrapped so the contents are revealed. They are also usually eaten as part of a meal rather than between meals as confectionery.

An example of a product which could not easily be categorised was considered by the tribunal in the case of Goodfellow and Steven Ltd (EDN/87/0010). At issue was the question of whether chocolate violets and chocolate marzipan walnuts were cakes or other confectionery. At the time, excepted item 2 standard-rated other confectionery (not including cakes) wholly or partly covered in chocolate or some product similar in taste and appearance. The products had a base of baked nut meringue, with buttercream piped onto the top, covered with a chocolate-like substance, and having a shelf life of two weeks boxed or one week in the open.

The tribunal found that there were no objective tests which can be applied to determine whether something is a cake and relied on their idea of the impression which would be made on the average man in the street. They did not find the absence of flour in the recipe conclusive: the products were made by skilled bakers and the average man having eaten them would have considered them to be cakes. The appeal was allowed and the products were zero-rated.

The following products, described below, are all zero-rated as cakes:

  • traditional flapjacks
  • chocolate crisp cakes (‘crunch’ cakes)
  • caramel shortcake
  • marshmallow teacakes
  • lebkuchen
  • traditional Japanese sweetmeats.

Asian sweetmeats are also zero-rated as cakes: see VFOOD9900.


The legislation standard rates confectionery but specifies that cakes (as well as biscuits that are not covered wholly or partly with chocolate) may be zero rated, under Excepted Item 2.

At the inception of VAT, traditional flapjacks were widely accepted as cakes of common perception. This was not because of any specific reasoning behind such factors as their recipe, ingredients, or the manufacturing process. HMRC accepts that traditional flapjacks can be zero rated.

However, there is a difference between traditional flapjacks - made of oats, butter and syrup - and cereal bars and energy/sports nutrition bars, which were not widely available, if at all, when VAT was introduced into the UK. Since that time, the difference between flapjacks on the one hand and cereal bars and energy/sports nutrition bars on the other has narrowed. For example, energy/sports nutrition bars contain oats and are called flapjacks, but are not traditional flapjacks. An amendment to the law in 1988 was made to bring products, particularly cereal bars, within the scope of the standard rate by defining confectionery as sweetened items of prepared food normally eaten with the fingers.

VAT treatment of flapjacks

We define traditional flapjacks narrowly, as it is intended to only apply to that product as it was at the inception of VAT. We interpret this with our policy that a traditional flapjack consists of oats, butter and syrup.

We allow the zero-rating of traditional flapjacks along with few minor traditional variations, such as dried fruit, chocolate chips, and chocolate or yogurt toppings. The addition of other cereals or other non-traditional ingredients such as protein powder, vitamins and minerals, added fibre, or multiple additions/variations means that it is no longer a traditional flapjack. We don’t accept a flapjack can be zero rated if alterations take it into the category of being a cereal bar or energy/sports nutrition bar.

The above policy is, we believe, fair and reasonable while being consistent with the law and with the development of the policy since the inception of VAT. Where it is unclear as to whether a product is a traditional flapjack, a more detailed assessment will need to be carried out to determine whether it is a cake in line with the established legal approach. Guidance for determining whether a product is a cake, biscuit or other type of confectionery is discussed in more detail in VFOOD6120.

The borderline has been examined in the cases of Glanbia Milk Ltd [2022] (TC 08439) and Torq Ltd [2004] (V.19389).

The tribunals considered a range of factors (known as a multifactorial assessment) for determining whether or not a product is a cake including the manufacturing process, ingredients, nutritional content, texture, appearance, function, typical circumstances of consumption, marketing and target markets, packaging and names. Both tribunals ruled that the products in question were not traditional flapjacks and did not have sufficient characteristics of cakes. They were therefore ruled to be standard rated confectionery.

Chocolate crisp cakes (crunch cakes)

These are made of breakfast cereals such as Rice Crispies or corn flakes covered in chocolate or carob and pressed into a round flat cake or cut into bars.

Caramel shortcake

These consist of a shortbread base covered with a layer of fudge or caramel and a chocolate topping, normally cut into individual bars. Two appeal cases concerning very similar versions of this product gave contradictory rulings. Following the latter of the cases of Good Taste (EDN/88/0030) and Marks and Spencer (LON/88/1316Y), it was accepted that caramel shortcake was zero-rated. This product is also commonly sold as millionaire’s shortcake.

However, chocolate-covered shortbread biscuits are standard-rated.

Marshmallow teacakes

Marketed under a variety of names, such as munchmallows, mallow cakes, teacakes, coconut mallows etc, these consist of a cake or crumb base topped with a dome of marshmallow coated in chocolate or carob, sugar strands or toasted coconut, and may be individually wrapped in foil. They have been traditionally accepted as cakes.


Small pieces of chocolate covered gingerbread, these look similar to sweets and are often packed like confectionery, but are in fact small cakes.

Traditional Japanese sweetmeats

These are cakes or biscuits and are zero-rated (unless they are biscuits covered in any way in chocolate or a product similar in taste and appearance).