Comic Book Heroes Beat the VAT Man!
An international food brand has successfully reclaimed over £100,000 VAT back after a tribunal ruled that they had been incorrectly charged by Her Majesty’s Revenue and Customs.
Dr Oetker, based in Leeds, who manufacture and retail Choco Lolly Kits for children under their Supercooks brand, had been liable for 17.5% VAT but, following a successful challenge by taxation experts The VAT Consultancy, the product was ruled to be tax exempt.
The kits, branded with such characters as Scooby Doo, Shrek and Barbie, allow young chefs-to-be to create bespoke chocolate lollies. The kits contain moulds, lolly sticks, chocolate and decorating materials. The country’s leading provider of independent VAT advice, The VAT Consultancy, argued at tribunal that the Choco Lolly Kits contained substantially more food than non-food items, indicating it should be VAT exempt.
In a move similar to the infamous case of Jaffa Cake classification, Her Majesty’s Revenue and Customs originally stated that a product containing kit-moulds and materials was not classed as food, and therefore VAT was liable to be paid on each product sold between 2004 and 2008.
John Crawford, Managing Director, of The VAT Consultancy said: “It was a case that should never have been brought to tribunal in our opinion. It’s excellent news that we have been able to reclaim this substantial amount of money for our client, and help them make continued savings into the future. Although HMRC are able to appeal, we’re confident that the tribunal ruled accurately in this matter – the proof of the pudding really is in the ingredients!”
For more information, please call The VAT Consultancy on 01962 73535
