In WM Morrison Supermarkets Ltd v HMRC [2025] TC09722, the First Tier Tribunal (FTT) found that rotisserie chickens were a supply in the course of catering, and therefore subject to VAT at 20%, as they were provided to customers in packaging that retained heat.
WM Morrison Supermarkets Ltd ('Morrisons') operates a well-known supermarket chain, which sold cooked rotisserie chickens.
- The chickens were cooked, put into bags, then placed onto unheated shelves, ready to be picked up by customers.
- Morrisons believed that the chickens met the Conditions for zero-rating food in VATA 1994 Schedule 8 Group 1.
- HMRC issued VAT assessments totalling £17,034,932 for the quarterly VAT periods 01/17 to 07/20, on the basis that the chickens did not qualify for zero-rating.
- Morrisons Appealed to the First Tier Tribunal (FTT).
VATA 1994 zero-rates food in Schedule 8 Group 1. An exception to the zero-rating is 'a supply in the course of catering'.
Note 3 includes in its definition of catering:
- any supply of it for consumption on the premises on which it is supplied; and
- any supply of hot food for consumption off those premises;
Note 3B defines 'hot food' as food which (or any part of which) is hot at the time it is provided to the customer and:
- has been heated for the purposes of enabling it to be consumed hot,
- has been heated to order,
- has been kept hot after being heated,
- is provided to a customer in packaging that retains heat (whether or not the packaging was primarily designed for that purpose) or in any other packaging that is specifically designed for hot food, or
- is advertised or marketed in a way that indicates that it is supplied hot.
Note 3C defines 'kept hot' as 'something that, after being heated, if the supplier stores it in an environment which provides, applies or retains heat, or takes other steps to ensure it remains hot or to slow down the natural cooling process'.
The FTT found that:
- The chickens were not advertised or marketed as hot food, but they were kept in packaging that retained heat.
- Morrisons claimed that the plastic-lined chicken bags were merely designed to contain chicken juice. It was found that in the packaging, a tightly-wrapped chicken would cool by 47.06% after 2 hours, compared with a 62.59% temperature drop for an unwrapped chicken over the same time period.
- The chickens were therefore 'kept hot after being heated' and were a standard-rated 'supply in the course of catering'.
Morrisons had submitted that HMRC had given a legitimate expectation that the chickens were zero-rated, but the FTT found that HMRC had made no such rulings or statements to Morrisons.
The appeal was dismissed.
Useful guides on this topic
Food, catering and takeaway
What is the VAT rate charged on food? How does this differ depending on hot or cold food and food consumed on or off the supplier's premises?
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