It’s a question lots of us have wondered at some point or another – can I claim back the VAT on my takeaway beverage if I don’t have the receipt?
The short answer is no.
Without a valid receipt, you cannot claim back the VAT on any purchase, including your beloved morning coffee.
What about those cheeky Starbucks trips whilst you’re on the go?
Surely, since Starbucks is VAT registered, it’s a given that they charge VAT on everything. Right?
While it might seem simple, there are actually quite a few variables to consider when it comes to VAT on takeaway coffee.
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The VAT Breakdown
You might be surprised by the fact that not all coffee purchases are treated equally when it comes to VAT.
For example;
Black coffee: No VAT
Plain Tea: No VAT
Hot Chocolate: VAT applies
Flavoured Coffee (like caramel lattes): VAT applies because it contains additional ingredients.
Pastry with Coffee: VAT applies on the pastry, but the coffee may or may not.
The important takeaway here is that VAT rules can be tricky. Some items, such as plain drinks like black coffee or plain tea, are VAT-exempt, while drinks with added ingredients or toppings (like milk, syrups, or whipped cream) are subject to VAT.
Without a receipt, we cannot keep track of what was ordered, or know for sure if VAT was applied.
The Importance of Keeping Your Receipts
If HMRC decides to check your tax return, they may request supporting documents. This is why it’s essential to keep all receipts, even for small purchases like takeaway coffee.
One way to ensure you don’t lose track of receipts is to go digital. By using digital tools and software to track your purchases, you can store a copy of your receipts and VAT details.
This makes it much easier to stay compliant and provide evidence if needed.
Make it easy on yourself by using Dext to keep a record of your expenses
At PPF Dext is probably our favourite app (after Xero of course!). We love it so much that it is automatically included in all of our limited company packages.
With just a few clicks you can take a picture of your VAT receipt as soon as you get it. Dext then extracts all the information and sends it across to Xero, along with a picture of the receipt.
In Conclusion
While the question of whether you can claim VAT on your takeaway coffee might seem straightforward, the reality is more complex.
Always remember to keep track of your receipts and be aware of the VAT rules surrounding different types of beverages.
After all, it’s better to be safe than sorry when it comes to managing your finances!
