VAT on Food and Alcohol in Glasgow Hospitality: Standard vs Zero Rate Explained

VAT on food in Glasgow hospitality depends on whether food is hot or cold, eaten on the premises or taken away, and whether it is a meal or a supply of groceries. Most food served in a Glasgow restaurant, café, or bar is standard-rated at 20%. Cold takeaway food is generally zero-rated. Alcoholic drinks are always standard-rated at 20%, regardless of how or where they are consumed.

Zero-rated vs standard-rated food: the key tests

• Cold food for takeaway: zero-rated (e.g., a cold sandwich from a deli).

• Hot food — any temperature above ambient: standard-rated at 20%.

• Food consumed on the premises (eat-in): standard-rated at 20%.

• Ice cream, confectionery, crisps, and alcoholic drinks: always standard-rated.

• Groceries, fresh fruit, and most cold drinks: zero-rated.

Hot food: the temperature test

HMRC defines hot food as food that has been heated, kept hot after heating, or intended for consumption hot by the seller. A baked potato, hot soup, or freshly grilled burger are standard-rated wherever sold. A cold Scotch pie that has not been heated is zero-rated, but the same pie sold warm from a heated display cabinet becomes standard-rated — even if the customer takes it away.

Eat-in vs takeaway

Where a Glasgow café sells identical items in two scenarios — eat-in and cold takeaway — the standard rate applies to eat-in and zero rate to takeaway cold food. Splitting the bill correctly requires staff to distinguish between orders and your till system to apply the correct VAT rate. Mixed supplies (a meal deal of cold sandwich with a hot drink) need apportionment or a combined ruling.

Alcohol is always standard-rated

Alcoholic drinks — beer, wine, spirits, and cider — are standard-rated at 20% regardless of whether sold in a bar, restaurant, or off-licence. This includes drinks included in a set-price menu. If a hospitality business sells a mixture of standard-rated alcoholic drinks and zero-rated food (a delicatessen with a license, for example), the VAT return needs clear apportionment.

Partial exemption and VAT registration threshold

The VAT registration threshold is £90,000. Glasgow hospitality businesses approaching this level should plan for compulsory registration — VAT must be added to taxable supplies immediately on registration, which can require a price review. Most hospitality turnover is standard-rated (hot food, alcohol, eat-in), which means input VAT on costs like food purchases, energy, and equipment can be reclaimed.

Use our VAT calculator to check VAT on any supply, and visit our VAT services page in Glasgow for help with VAT registration, returns, and partial exemption planning.