Giant marshmallows beat second £470k VAT appeal

HMRC has lost a long running case over the VAT status of giant marshmallows with the Upper Tribunal ruling that they are not confectionery

Innovative Bites has won its appeal over a disputed VAT bill for £472,928 as tribunal agreed that the giant mallows are not subject to the standard VAT rate as they are designed to be roasted over a fire.

At the Upper Tribunal, HMRC appealed the decision from the First Tier Tribunal (FTT), rejecting the company’s claim that the snacks were not confectionery.

Innovative Bites claimed that the marshmallows would mostly be sold in the summer months, in the BBQ sections of the supermarkets they were sold in as they were intended to be roasted over a fire or barbecue.

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