VAT on catering for private events — is it different from food sold in my café?
11 views
I run a small café in London and we are VAT registered. Most of our day-to-day sales are straightforward: customers eat in, or take a coffee and a pastry away, and I understand how VAT applies to those sales. Recently, however, several regular customers have asked us to cater private events, such as birthday parties and small office celebrations, and I am not sure whether those jobs are treated in the same way.
The first enquiry was for a buffet at a customer's home for about forty guests. We would prepare the food in our kitchen, deliver it, set it up, and collect the trays afterwards, but we would not provide waiting staff. Another enquiry is for a sit-down lunch in a hired hall, where we would serve the food, provide crockery, and stay for the whole event. I want to know whether the presence of staff, service, and equipment changes the VAT treatment, or whether it is simply the food that matters.
My other concern is how to price and invoice these jobs. At the moment I tend to quote one overall price for food, delivery, and hire of equipment, but I wonder whether I should split those elements on the invoice. If part of the job is zero-rated and part is standard-rated, a single price could cause problems. I also need to understand what happens with extras such as a cake supplied by the customer, soft drinks, and a service charge that I pass on to staff.
Finally, I would welcome practical advice on record-keeping and VAT returns. Should catering income be recorded separately from café sales, and does taking on occasional private events affect my VAT registration or my choice of VAT scheme? I want to get this right before I accept a booking, rather than discovering a mistake at the year end. Any guidance from accountants who work with cafés or caterers would be very helpful.