Latest from the courts
In the Minerva Research Labs Limited v HMRC [2026] UKFTT 1320 (TC) First-Tier Tribunal (FTT) case the issue was whether collagen beauty drinks are standard-rated, or zero-rated as food of a kind used for human consumption. In order to determine the correct VAT treatment, the Tribunal was required to apply a judicial ‘multifactorial test’. This meant assessing the product’s ingredients, appearance, marketing, and function to decide how an ordinary person would view the product.
Background
The appellant produces a range of collagen-based liquid supplements which are targeted at the health of skin, hair, and joints and muscles. The products are packaged in cartons containing small, single-use, mono-dose bottles.
Minerva initially accounted for output tax on the sale of the product. However, it subsequently submitted an error-correction claim which sought a refund of circa £3.64 million on the basis that the drinks should be zero-rated food. HMRC rejected the claim, prompting Minerva’s appeal.
NB: For VAT purposes, ‘food’ includes drink.
Decision
The FTT acknowledged that the products provide nutritional value; supplying a notable percentage of daily protein requirements alongside energy, vitamins, and minerals, but that nutritional density does not automatically equal food. It determined that:
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the products were held out for sale as liquid beauty products
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they were purchased for cosmetic and anti-ageing reasons
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they were not marketed to be eaten instead of a meal, or as a snack
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the words ‘dose’ and ‘treatment’ appeared marketing and packaging
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the products were labelled with precautions or warnings (that food would not)
Consequently, the products were not food and standard rating applied.
The appeal was therefore dismissed.
Legislation
VAT Act 1994, Schedule 8, Group 1, item 1. Food of a kind used for human consumption.
Commentary
Another case on what is food. New products seem appear on a daily basis and the products themselves and marketing of the develop at a rapid pace as a result of changes to consumer tastes and health trends. Trying to fit modern foods into 1970s definitions (when VAT was introduced) will always cause absurd, contradictory results.
This case follows on from well-know cases such as: Jaffa Cakes, Mega Marshmallows, Walkers Sensations Poppadoms, Duelfuel Nutrition, and Greggs, sausage rolls as well as flapjacks, brownies and cereal bars. If there is any doubt about whether a ‘food’ product is covered by the zero-rating, we advise that expert advice is sought (we are happy to provide it!)