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VAT - Two Fast Food Outlet added together for VAT - One sells Hot Food and the other both Hot and Cold Food

VAT - Two Fast Food Outlet added together for...

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On a rolling 12 months period, the total turnover of the two fast food added together meant that the owner should have registered for VAT.

However, as one shop sells 15% Hot Food and 85% Cold Food, what would be the correct calculation to determine VAT Registration or not?

1. Should we take into account total turnover of both outlets or

2. Turnover of the first shop (fish and chip shop) plus 15% TUrnover of the second shop (sandwich shop)

Early answers will be greatly appreciated.

Have a nice day.


Replies (3)

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By Cirius di Lemma
17th Feb 2011 10:33

Assuming the same VAT person controls both businesses...

... it's the total of both.  Cold food supplies are still taxable supplies, they're just zero-rated if sold for consumption off the premises.

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By carnmores
17th Feb 2011 16:49

to clarify this question re disaggregation

its not who runs the businesses but who owns them and it is a subtle difference that may be important - if for instance one business was a limited company and one a sole trader then they could be treated separately. also they appear to be different shops / locations and the businesses were started at different times, am i correct?  if so then there may be a legal route to not register for tax -also remnember to take account of any input tax that may be recoverable in weighing up matters tho i grant you there is often not a lot of reclaimable vat in food businesses there may be some on rent etc 

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By mbuffery
18th Feb 2011 09:16

Notify obligation to register, but exemption may be available

If, after deducting the 85% zero rated sales of the sandwich shop, the total turnover is below the threshold for VAT registration, then you can ask HMRC to exempt the business from VAT registration, until such time as the standard rated turnover exceeds the limit.  However, this exemption must be requested, otherwise you will incur a penalty for failure to notify an obligation to register.  (VAT Act 1994, Sch1, para 14)

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