Summaries of interesting VAT cases for the SME owner.
The government is introducing a temporary reduced rate of VAT for children's meals in restaurants and family leisure activities over the summer. VAT will be reduced from 20% to 5% on these qualifying activities as part of the latest government drive to ease pressure on household budgets.
In Queenscourt Ltd v HMRC [2026] UKUT 00195, the Upper Tribunal (UT) found that dip pots provided as part of KFC meal deals were zero-rated as components of a multiple supply.
HMRC have published 'Revenue and Customs Brief 4 (2026): VAT liability of supplies of electricity from public electric vehicle charge points'. This explains HMRC’s position following the First Tier Tribunal (FTT) decision in Charge My Street Ltd v HMRC [2026] TC09802.
Incorrect advice provided by Artificial Intelligence (AI) and third-party websites is contributing to a growing trend of late VAT return filing and payment. HMRC are reminding agents and taxpayers that there is no deadline extension if the due date falls on a bank holiday or weekend.
HMRC have published 'Revenue & Customs Brief 3 (2026): VAT treatment of certain public funds received by further education institutions' in response to the Court of Appeal (CoA) ruling in HMRC v Colchester Institute Corporation [2026] EWCA Civ 363.
In Clearwater Hampers Limited v HMRC [2026] TC09843, the First Tier Tribunal (FTT) found that lidded wicker baskets supplied as part of a gift hamper were, for VAT purposes, ancillary to the food and drink supplied. They were not a separate standard-rated supply.
In Innovative Bites Ltd v HMRC [2026] TC09831, the First Tier Tribunal (FTT) again found in favour of Innovative Bites Ltd, holding that its 'Mega Marshmallows' were zero‑rated for VAT as food; they were not confectionery.
