VAT Food Nuance! (Nov 2025)

Bottled Science have been granted permission to appeal at the Upper Tribunal.

The VAT case has become a focal point in the ongoing debate over the VAT treatment of dietary supplements and functional foods in the UK. At issue is Skinade, a liquid collagen supplement marketed for skin health.

Bottle Science argued that Skinade should be zero-rated for VAT as “food of a kind used for human consumption,” highlighting its nutritional ingredients and the fact that similar products, like probiotic drinks, are zero-rated.

HMRC disagreed, classifying Skinade as a beauty product subject to standard VAT. Their position was based on the product’s primary purpose – improving skin appearance rather than providing general nutrition – and its marketing through beauty clinics and salons, not food retailers. The packaging and branding, described as “clinical,” further supported HMRC’s view that Skinade is not a typical food product.

The FTT sided with HMRC, finding that while Skinade has some nutritional value, its main purpose is cosmetic. The FTT’s decision was heavily influenced by how the product is marketed and sold, concluding that a typical consumer would not regard it as food for VAT purposes.

This case will now progress to the Upper Tribunal. The appeal will address whether the FTT placed too much emphasis on marketing over other factors, and whether it correctly interpreted the law in light of recent appellate decisions, such as Innovative Bites Ltd, which considered whether drinks are automatically “food” for VAT unless an absurd result would follow.

This case is significant for the supplement and functional food industry, highlighting the importance of product presentation, marketing, and consumer perception in VAT classification. The outcome of the appeal could have wide-reaching implications for how similar products are treated for VAT, potentially impacting both manufacturers and consumers.