The Supreme Court has refused permission for Sub One Ltd, a Subway franchisee, to appeal the Court of Appeal’s decision that standard-rating applied to supplies of toasted sandwiches (known as ‘Subs’) and a product called ‘meatball marinara’
The franchise leading the case is part of the nationwide chain of Subway which has some 1,800 franchisee outlets in the UK and Ireland.
At earlier court hearings, HMRC assessed the meatball sandwich products as ‘standard rated’ for VAT (rather than ‘zero-rated’) on the basis that they were ‘hot food’.
This case was one of some 1,200 appeals by Subway franchisees challenging HMRCʼs decision that standard-rating applied. Those other appeals were stayed, pending the outcome of this lead appeal. The initial case started after the government introduced the pasty tax at Budget 2012.
The initial First Tier Tribunal (FTT) ruling on the issues focused on the temperature of the sub and any fillings as being ‘above ambient air temperature’, with advertising material which cited ‘fresh toasted’ as evidence of this being hot food and therefore standard-rated.
Subwa
