United Kingdom Tax Tribunal Clarifies VAT Treatment of Packaging Used in Food, Drink Gift Hampers

The United Kingdom First-Tier Tax Tribunal April 10 issued a decision in Case No. TC09843, clarifying the VAT treatment of packaging used in food and drink gift hampers. The taxpayer, a company, sold curated food and drink gifts packaged in containers, including lidded wicker baskets, and claimed repayment of output VAT. The Tax Agency denied the taxpayer’s claim based on VAT notices treating hampers as distinct taxable supplies. On appeal, the Tax Tribunal upheld the taxpayer’s appeal, finding that: 1) purchasers sought food and drinks as gifts and treated the lidded wicker baskets as serving ancillary presentation and protection functions ...