VAT on hot takeaway food vs eat-in — when is it 20 percent and when is it zero-rated?

Hi Oliver — VAT on food is one of the trickiest areas, so here's the rule of thumb. Anything eaten in on your premises counts as catering and is always standard-rated at 20%, with no zero-rating option. For takeaway, hot food sold for consumption off the premises is also standard-rated at 20% — so your hot toasties to take away are 20%. Cold takeaway food is generally zero-rated, which is why cold sandwiches and pre-packed cold items can be sold at 0%, but be careful: freshly baked pastries sold hot for immediate consumption are treated as hot food and stay at 20%. Because this is so fact-specific, make sure your till distinguishes eat-in, hot takeaway and cold takeaway, and keep a short written note of the logic so an HMRC officer can see the basis on a visit.