The dispute arose in connection with several HMRC decisions over the taxable status of Ferrero UK’s new Nutella Biscuits, adding to the long litany of food related VAT cases and saving the company a charge for standard 20% VAT.

This appeal to the First Tier Tribunal (FTT) concerned whether ‘Nutella Biscuits’ manufactured by Ferrero UK Limited were ‘biscuits… partly covered with chocolate or some product similar in taste and appearance’ for the purposes of the Value Added Tax Act 1994 (VATA) Schedule 8 Group 1 Excepted Item 2 (Excepted Item).

At the tribunal, Ferrero attempted to overturn two decisions by HMRC that the product was rateable at 20% VAT, and as such, a charge for output tax for various periods covering tax years 2022-23 and 2023-24 was payable.