Last updated: 14 October 2026
Do you have to charge VAT on smoothies sold in a gym?
Yes, if you are VAT-registered. Smoothies, fruit juices and most other drinks are “beverages”, which are excluded from the zero rate for food. They are standard-rated at 20%, whether customers drink them in the gym or take them away. The same applies to protein shakes sold ready to drink. Food items you sell, such as protein bars or sandwiches, have their own rules.
Why drinks are treated differently
Most food is zero-rated, but the law lists exceptions that are always standard-rated. Beverages are one of them, including fruit and vegetable juices, smoothies, soft drinks and bottled water. Milk and milkshake powders can be zero-rated in some cases, but a ready-made smoothie or shake is a beverage.
Common gym café items
| Item | VAT rate |
| Smoothies and fresh juices | 20% |
| Ready-to-drink protein shakes | 20% |
| Bottled water and energy drinks | 20% |
| Hot drinks | 20% |
| Cold sandwiches to take away | 0% |
| Food eaten in a seating area | 20% (catering) |
| Hot food | 20% |
| Plain protein bars | Can depend on composition; chocolate-coated bars are 20% |
Gym memberships and VAT
Gym memberships are normally standard-rated. Some non-profit sports bodies can get an exemption. Your café sales count towards your VAT threshold along with membership income.
The threshold
If the gym and café are run by the same business, all of its taxable sales count towards the £90,000 VAT threshold. A separate café business run by someone else has its own threshold.
Example
A gym café sells smoothies at £4.80 each. The VAT included is £4.80 ÷ 6 = £0.80. Selling 50 a day for 300 days gives £72,000 of sales, of which £12,000 is VAT.
Should you use the flat rate scheme?
Small cafés and gyms can use the flat rate scheme if their turnover is £150,000 or less. The rate for catering is different from the rate for gyms, so choose the rate for your main activity. Check whether you are a limited cost trader before you join.
Pricing tips
- Show VAT-inclusive prices to customers
- Set up your till to apply the right rate to each product
- Review packaging and product names, because a “shake” mix sold dry may be treated differently from a drink
Common VAT mistakes in food and drink
Hot food and drinks are standard-rated even when sold to take away. Cold food is zero-rated if it’s taken away, but standard-rated if it’s eaten on the premises. Confectionery, crisps and sweets are always standard-rated. Set up your till so each product has the right VAT code, and review it when you add new products. Review prices after VAT changes.
Frequently asked questions
Are smoothies zero-rated as food?
No. They are beverages and standard-rated.
What about a smoothie bowl eaten with a spoon?
It may be food rather than a drink. Treatment depends on the product, so ask for advice.
Do I charge VAT if I’m not registered?
No, but your sales count towards the threshold.
Can I reclaim VAT on the blender and ingredients?
Yes, on equipment. Most fruit is zero-rated, so there is little VAT to reclaim on it.
Related: VAT on bakery items and how to calculate VAT.
Talk to Accotax
Want this handled for you? Our team at Accotax can help with VAT on food and drink sales. See our VAT accountants service, or contact us for a free, no-obligation quote.
This page is general guidance based on HMRC rules for the 2026/27 tax year, checked against gov.uk on 14 October 2026. It is not personal advice, so speak to an accountant about your own situation.
