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HMRC internal manual

VAT Food

Excepted items: confectionery: treatment of particular products: cereal bars: health bars

Traders may argue that their fruit and / or cereal bar should not be treated as confectionery in the same way as ordinary bars because their product is too specialised. For example, bars may be designed specifically for athletes, or may contain medicinal ingredients. However, provided that the bar has the characteristics of sweetened prepared food normally eaten with the fingers, it should be standard-rated as confectionery regardless of its special qualities or ingredients.

In the case of McNeil Consumer Nutritionals Ltd (LON/01/1209), the trader appealed that their bar contained plant stanol ester (an ingredient that lowers cholesterol) and was therefore not confectionery. The appellant argued that their bars were not in competition with other bars, as they were more expensive and were unlikely to be bought except by someone seeking the medicinal benefits.

However the tribunal found that, regardless of the undoubted medical benefits of the product, it was a sweetened prepared food eaten with the fingers and therefore fell within the definition of confectionery and was standard-rated.

In EJ Huczek (MAN/92/0507), the Tribunal dismissed the appellant’s arguments that his Cross Trainer Bars were not confectionery as their market was restricted to specialist consumers only (sportsmen), and their price was so much higher than other confectionery items in bar form. Despite the marketing and the price of the product, the tribunal held that it was still an item of sweetened prepared food which is normally eaten with the fingers and therefore standard-rated.

Furthermore, since the decisions of Premier Foods (Holdings) Ltd and Bells of Lazonby (see VFOOD7160), consideration would need to be given to whether such products are items of confectionery per se, even if they have not been sweetened.