VAT on takeaway food: a plain-English guide for UK takeaways and cafés
Is there VAT on takeaway food? For most of what a UK takeaway sells, yes. Hot food and hot drinks are standard rated at 20%, and so is anything eaten on your premises. Cold takeaway food is usually zero rated, but there are exceptions, such as crisps, sweets and soft drinks.
This guide explains the rules from HMRC's VAT Notice 709/1 (last updated 8 June 2026) in plain English, with worked examples. It also shows how to set your EPOS till up so each item is charged and recorded at the right rate. It's general guidance, not tax advice, so check anything borderline with your accountant.
The short answer
If you are VAT registered:
- Hot takeaway food: 20% (standard rated).
- Hot takeaway drinks such as tea and coffee: 20%.
- Cold takeaway food: 0% (zero rated), unless it's a type that is always standard rated.
- Always 20%, hot or cold: crisps and similar snacks, sweets and other confectionery, and drinks such as soft drinks and bottled water.
- Anything eaten on your premises, hot or cold: 20%.
You must register for VAT if your taxable turnover goes over £90,000 in the last 12 months, or you expect it to go over £90,000 in the next 30 days (gov.uk). Zero-rated sales count towards that £90,000.
VAT on hot takeaway food: what counts as "hot"
HMRC says food is "hot" if it's above the air temperature around it. A sale is standard rated if the food (or any part of it) is hot when the customer gets it, and it meets at least one of these five tests:
- It was heated so it could be eaten hot.
- It was heated to order.
- It was kept hot after it was heated, for example in a hot cabinet or under a heat lamp.
- It's in packaging that keeps it hot, or packaging made for hot food.
- It's advertised or marketed as hot.
For a Chinese takeaway, fish and chip shop or pizza shop, almost everything on the menu passes test 1 or test 2, so it's 20%. It's the seller's purpose that counts, not the customer's. A customer who says they'll eat it cold tomorrow doesn't change the rate.
A kebab or a bacon sandwich with cold salad inside is still one hot item, so the whole thing is 20%.
Freshly baked items that are cooling down
Bread, pies, pasties and cakes that are only warm because they've just come out of the oven can be zero rated. That applies if you let them cool naturally, don't keep them hot, don't use heat-keeping packaging and don't advertise them as hot. "Freshly baked" on your sign is fine. "Hot pasties" makes them 20%.
VAT on cold takeaway food
Cold food sold to take away is zero rated as long as it isn't an item that's always standard rated. Typical zero-rated items are cold sandwiches, salads and wraps. Typical standard-rated items, even when cold, are crisps, sweets, ice cream, soft drinks, bottled water and alcohol. The full list is in HMRC's food products notice 701/14.
Eat in or take away?
Food and drink eaten on your premises is always 20%, even if it's cold. "Premises" means the area you occupy and any seating you set aside for your customers, including tables and chairs outside your shop. General public seating, like a shopping centre bench, doesn't count.
So the same cold sandwich can be 0% to take away and 20% to eat in. If you sell cold food to take away and also have seating, your till needs to know which is which. If you can't tell at the point of sale, HMRC expects you to keep evidence for a fair split.
Delivery charges
When delivery to the customer is part of the order, the delivery charge follows the VAT rate of the food. Free delivery, or delivery built into the price, works the same way (VAT Notice 700/24, section 2.2). Delivering hot cooked meals counts as catering, so for a normal hot takeaway order the delivery fee is 20% too. Showing the fee as a separate line on the receipt doesn't change that.
Worked examples
All prices include VAT. At 20%, the VAT inside a price is one sixth of it.
A Chinese takeaway order
| Item | Price | VAT rate | VAT included |
|---|---|---|---|
| Chicken chow mein (hot) | £8.50 | 20% | £1.42 |
| Can of cola | £1.50 | 20% | £0.25 |
| Delivery charge | £2.50 | 20% | £0.42 |
| Total | £12.50 | £2.09 |
Nothing in this order is zero rated. For most hot-food takeaways, nearly every sale is 20%.
A café selling to take away and eat in
| Item | Price | Take away | Eat in |
|---|---|---|---|
| Coffee (hot) | £3.00 | 20% (£0.50) | 20% (£0.50) |
| Cold cheese sandwich | £4.20 | 0% (£0.00) | 20% (£0.70) |
| Packet of crisps | £1.20 | 20% (£0.20) | 20% (£0.20) |
The sandwich is where the money is. Charge 20% on every takeaway sandwich and you overpay HMRC. Charge 0% on every sandwich eaten in and you underpay.
Meal deals at one price
If a deal mixes zero-rated and standard-rated items, and each item can also be bought on its own, you have to split the deal price between them. HMRC says to use cost or market values. One common method is to split by the normal menu prices.
Example: a £6.00 deal of a takeaway coffee (normally £3.00) and a cold sandwich (normally £4.20). Together they would be £7.20.
- Coffee share: £6.00 × 3.00 ÷ 7.20 = £2.50, which includes £0.42 VAT.
- Sandwich share: £3.50, zero rated.
Agree the method with your accountant and use it every time. Free extras like salt, vinegar and sauce sachets can be ignored.
Setting up VAT on your EPOS till
Most VAT mistakes in takeaways happen on the till, not on the tax return. Before you start trading, or after any menu change, check this list:
- Every menu item has a VAT rate. Don't leave a single default rate for the whole menu if you sell cold food or snacks.
- Items that can be eaten in or taken away have the right rate for each order type.
- Soft drinks, crisps, sweets and desserts are set to 20%, even though they're cold.
- Delivery charges are set to the same rate as the hot food they go with.
- Meal deals with mixed items are split, not charged at one rate.
- Receipts show your VAT number and the VAT amount. A clear receipt printer helps if a customer asks for a VAT receipt.
- You can pull a sales report for any date range for your VAT return.
Keep your VAT records for at least 6 years (gov.uk). All VAT-registered businesses should now be signed up for Making Tax Digital for VAT, so you'll need software that can submit returns, usually through your accountant or bookkeeping software.
If you're also working out the cost of a new system, see our guide to how much an EPOS system costs for a UK takeaway.
Where GofoodPOS fits
GofoodPOS works out VAT per dish and shows it on receipts, so a cold sandwich and a hot coffee on the same bill are each charged at their own rate. Till sales and online orders share one menu, so you set the rates once. Reports cover any date range and download as a spreadsheet for you or your accountant. Setup and support are in English and Chinese. Plans are on the pricing page.
In short
- Hot takeaway food and hot drinks: 20%.
- Cold takeaway food: 0%, except crisps, sweets, soft drinks, bottled water, alcohol and other always-standard-rated items.
- Anything eaten on your premises: 20%.
- Delivery charges on hot food orders: 20%.
- Split meal deals that mix 0% and 20% items.
- Register once your taxable turnover passes £90,000 in 12 months, and keep records for 6 years.
Not sure your till is set up right? Get in touch and we'll go through it with you, in English or Chinese.