VAT on takeaway food: hot, cold, eat-in (UK)
Which café food is standard-rated and which is zero-rated, with everyday examples from gov.uk VAT Notice 709/1, and what it means for your gross profit.
The short version. Eat-in is standard-rated at 20%. Hot takeaway food and drink is standard-rated too. Cold takeaway food is zero-rated, except types that are always standard-rated, such as crisps, sweets and some drinks. All of this is from gov.uk VAT Notice 709/1, and the section numbers below are that notice's.
Eating in: standard-rated
If you supply food or drink for consumption on your premises, you must charge VAT at the standard rate (section 3.1). That applies whether the food is hot or cold. Your premises include any area set aside for customers to eat, which can include tables and chairs on the pavement outside (section 3.2). Tables provided for the general public, who are not your customers, are not counted.
Hot takeaway: standard-rated
Hot takeaway food and drink that meets the notice's tests is standard-rated (section 4.1). Something is hot if it is above the ambient air temperature when you provide it to the customer (section 4.3), and then at least one of five tests must also apply (section 4.2):
- you heated it so that it can be eaten hot;
- you heated it to the customer's order, as with toasted sandwiches and panini;
- you kept it hot after cooking or heating, for example in a heated cabinet or under lamps;
- you give it to the customer in packaging that keeps in heat;
- you advertise or market it as hot.
If you sell a hot item with a cold ingredient as a single item, the whole supply is standard-rated (section 4.6).
Cold takeaway: mostly zero-rated
Cold takeaway food and drink is zero-rated, as long as it is not a type that is always standard-rated (section 4.1). The notice names potato crisps, sweets and some beverages including bottled water. Check the notice if your item might fall into one of these groups.
Everyday café examples
| Item | Takeaway | Why, and where in the notice |
|---|---|---|
| Bacon roll, hot | Standard-rated | Hot at handover and heated to order (4.2, 4.3) |
| Toastie | Standard-rated | Toasted sandwiches are heated to order (4.3); a cold ingredient does not change that (4.6) |
| Coffee to go | Standard-rated | Hot takeaway drinks (4.1, 4.3) |
| Cold sandwich | Zero-rated | Cold takeaway food (4.1). Standard-rated if eaten on your premises (3.1) |
| Slice of cake | Zero-rated | Cakes are among the bakery products the notice treats as zero-rated when none of the five tests apply (4.4, example 4) |
| Hot pasty | Check the notice | Zero-rated if left to cool naturally, in standard packaging and sold as freshly baked; standard-rated if kept under lamps or advertised as hot (4.4, examples 1 to 3) |
| Bottle of water | Standard-rated | Named as a cold beverage that is always standard-rated (4.1) |
| Bag of crisps | Standard-rated | Named as always standard-rated (4.1) |
The notice does not name every product. Where an item is not listed, work from the rules above and check the notice.
Why this changes your GP
Gross profit is worked out on the price without VAT, so the same menu price earns you less when VAT applies. Take a cold sandwich that costs £1.80 to make and sells for £4.00.
| Takeaway (zero-rated) | Eat in (20% VAT) | |
|---|---|---|
| Menu price | £4.00 | £4.00 |
| Price without VAT | £4.00 | £3.33 |
| Ingredient cost | £1.80 | £1.80 |
| Gross profit | £2.20 | £1.53 |
| GP % | 55.0% | 46.0% |
If you charge £4.00 either way, the eat-in sale keeps £0.67 less of the price. Put each dish through the café and takeaway GP calculator, choosing VAT or no VAT to match how it is sold.
Cost every dish in one workbook
The UK Café and Takeaway Food Cost and GP Calculator is a spreadsheet for £12.99. It works out GP on the price before VAT and shows what delivery-app commission does to it.
Get the café workbook, £12.99Questions people ask
Is takeaway food VAT-free?
Cold takeaway food is zero-rated unless it is a type that is always standard-rated, such as crisps, sweets and some drinks including bottled water. Hot takeaway food and drink is standard-rated at 20%, and so is anything eaten on the premises (VAT Notice 709/1, sections 3.1 and 4.1).
Is a coffee to go standard-rated?
Yes. The notice says hot takeaway drinks are standard-rated, and lists tea, coffee, chocolate and other hot drinks as heated to be drunk hot (sections 4.1 and 4.3).
Is a hot pasty or sausage roll standard-rated?
It depends. The notice gives examples: a pasty left to cool naturally, in an ordinary paper bag and sold as freshly baked, is zero-rated. One kept under heat lamps, or advertised as hot, is standard-rated (section 4.4, examples 1 to 3). Check the notice for your own set-up.
Do I charge VAT on a cold sandwich if the customer eats in?
Yes. Food supplied for consumption on your premises is standard-rated, hot or cold. Your premises include areas set aside for customers, such as tables and chairs outside the shop (sections 3.1 and 3.2).
General information, not tax advice. Check the notice or HMRC if you are unsure how an item is treated.
Checked against gov.uk on 7 November 2026. Source: gov.uk, Catering, takeaway food and VAT (VAT Notice 709/1).