Is there VAT on nuts (and other snacks)? Yes, and no.
Welcome to out latest post on the weird and wonderful world of VAT in the UK. We’re going to talk about snacks, but we’re starting with nuts as it possibly needs the most explanation.
So do nuts have VAT? Unfortunately there is no simple answer to that, but we’ll try. Firstly, we need to know if they are shelled or not. If they are not shelled then they are zero-rated, if they are shelled then they are standard rated, except for peanuts, which are zero-rated regardless. However, if roasted or salted then they are subject to VAT like any other nut. That’s not the end of it though, if you have peanuts in any kind of fruit and nut mix and more than 25% of that mix is standard rated, then peanuts become standard rated too.
It doesn’t end there though. We’ve just discussed how nuts, if shelled are standard rated. However, this only applies for nuts for snacking, if the shelled nuts are to be used as ingredients, whether for baking or cooking, then they are zero rated, regardless of whether they are shelled, roasted or not. In theory, you could have two packs of nuts, exactly the same in every way, apart from the packaging (snacking or baking) and one would be subject to VAT and the other would not.
There are lots of quirks around snack foods, it’s not just nuts. We all know the debate about whether jaffa cakes are biscuits or cakes (they’re cakes by the way, at least in the eyes of the law), but similar controversy rages in the world of crisps.
For example, Pringles were ruled to be standard rated as one of their primary ingredients is potato, however, Doritos, made primarily of corn are zero rated. Other zero-rated ‘crisps’ are Skips and Twiglets, but bad news if you’re a fan of Monster Munch or Wotsits as they are standard rated.
It goes on, there are all sorts of exceptions in most areas of food as new products emerge and evolve, they cannot easily fit the original classification of snack foods so are placed as best they can be.
Makes for fun reading though!