Case Update: Innovative Bites
11 August 2025
The Supreme Court has refused an application for permission to appeal the Court of Appeal's decision on the legal interpretation of the VAT zero-rating legislation drawing the line between 'food' and 'confectionary'. The intervener in the Innovative Bites 'giant marshmallow' Court of Appeal hearing had sought permission to appeal. This brings to an end Innovative Bites' appeal on points of law concerning the meaning of 'confectionary' for VAT purposes; its appeal will now return to the First-tier Tribunal for a finding of fact on whether or not its product was normally eaten with the fingers based on the existing evidence and the original FTT's findings of fact.
The outcome of this stage in the litigation emphasises three key points. First, the importance of having a clear dispute resolution strategy in place from the outset of any HMRC enquiry; often, there is more than one route to success. Secondly, that the evidence a taxpayer can assemble is very often crucial to its prospects. Finally, the findings of fact made by the FTT (if the dispute progresses that far) usually will set the course for any subsequent appeals.
Taxpayers with live enquiries and those with cases formally stayed or informally stood behind the Innovative Bites litigation should now take stock.
Tim Brown has acted for Innovative Bites at every stage of its appeal, with Stephen Morse appearing with Tim in the Court of Appeal.
![]()