What are the VAT rules for catering invoicing?

VAT rules for catering invoicing can seem complicated, but with the right knowledge, it becomes a lot easier. As a catering company, you have to deal with different VAT rates depending on your services and locations. You need to know when to charge 9% or 21% VAT, which costs you can deduct, and how to draw up invoices correctly. The location of your catering business also plays an important role in VAT treatment. Good administration and knowledge of common mistakes will help you avoid problems with the tax authorities.

What VAT rates apply to catering?

Catering services are subject to two different VAT rates: the low rate of 9% and the high rate of 21%. The rate you must apply depends on what you supply and where you do so.

The 9% VAT rate applies to:

• Food and drink that you supply for immediate consumption
• Catering where you only provide food and drinks
• Meals that you deliver to customers’ homes
• Lunches and dinners without additional services

The 21% VAT rate applies to:

• Complete event management including staff
• Rental of equipment such as tables, chairs, and tableware
• Decoration and styling of events
• Alcoholic beverages above certain percentages
• Catering services combined with entertainment

Please note: if you combine different services, you must list them separately on your invoice with the correct VAT rate. A wedding where you provide both the food (9%) and the complete service with staff and materials (21%) requires a split invoice.

VAT deduction on catering purchases

As a catering entrepreneur, you can reclaim VAT on your business purchases. This helps you to reduce your costs and improve your cash flow. Here you can see which costs you can and cannot deduct:

Deductible:

• Ingredients and raw materials for your dishes
• Professionele keukenapparatuur en servies
• Transport costs and fuel for delivery
• Packaging materials and disposables
• Cleaning agents and hygiene products
• Office supplies and software for your administration

Not deductible or only partially deductible:

• Entertainment expenses (only partially deductible)
• Private use of company assets
• Fines and penalties
• Staff parties above certain amounts

Always keep your invoices and receipts digitally. For smaller purchases under £25, a receipt is sufficient, but make sure all details remain legible. For larger purchases, you will need a full invoice with VAT details.

Invoice requirements for catering services

A correct invoice is important for your VAT administration and prevents problems with the tax authorities. Catering invoicing is subject to specific requirements that you must comply with. A professional quotation system helps you to process all mandatory information automatically.

Mandatory information on every invoice:

• Your company name, address, and VAT number
• Customer details including name and address
• Unique invoice number in chronological order
• Invoice date and delivery date
• Clear description of services provided
• Amounts excluding VAT per VAT rate
• VAT amount stated separately for each rate
• Total amount including VAT

On advance invoices, clearly state that it is an advance payment. On the final invoice, deduct the advance payment and state the remaining balance. This prevents confusion among your customers and on your VAT return.

Common mistakes in VAT returns

Many catering companies make the same mistakes in their catering VAT returns. By being aware of these, you can avoid costly errors and fines from the tax authorities.

Most common mistakes:

Applying the wrong VAT rate: You charge 21% VAT for a simple lunch or 9% for complete event catering. This leads to incorrect tax returns and possible additional tax assessments.

Do not split mixed services: For combinations of food (9%) and services (21%), invoice everything under one rate. The Tax and Customs Administration requires a correct split per service.

Missing invoice details: Incomplete invoices without a VAT number, incorrect dates or unclear descriptions. This may result in your VAT deduction being rejected.

Mixing private and business: deducting private purchases as business expenses or using business resources privately without correcting the VAT return.

Tips to avoid mistakes:

• Use software that automatically applies the correct VAT rate
• Check your invoices monthly for completeness.
• Keep private and business matters strictly separate
• Keep all supporting documents digitally and organised
• If in doubt, have your tax return checked by an accountant.

VAT for events at different locations

The location of your catering assignment partly determines how you should treat VAT catering. Different locations have different rules, which affects your invoicing.

Catering at business premises:

Normal Dutch VAT rules apply to catering at offices and business premises. You charge 9% for food and 21% for additional services. Make sure your invoice states the address of the delivery location.

Catering at private residences:

Home catering is usually subject to the 9% rate, unless you provide complete event services. Please note that for large private parties where you also provide entertainment and decoration, the 21% rate applies to those components.

Catering in public areas:

The same rules apply to events held in parks, town halls or other public locations. Make sure you have all the necessary permits, as this may affect your VAT treatment.

Foreign events:

Catering abroad is subject to special VAT rules. Within the EU, the VAT rate of the country where you deliver often applies. Different rules may apply to countries outside the EU. Always consult a specialist for international assignments.

Administration and documentation for VAT

Good catering administration is the basis for correct VAT processing. With the right setup, you save time and avoid errors in your tax return.

Documents you must keep:

• All invoices you send (keep for 7 years)
• Purchase invoices and receipts from suppliers
• Contracts and agreements with customers
• Bank statements and payment receipts
• VAT returns and correspondence with the Tax and Customs Administration
• Mileage records for business journeys

Digital opportunities for efficient management:

Modern catering software makes your administration much easier. You can automatically generate invoices with the correct VAT rates, link to your accounting software, and store all documents digitally. This saves time and significantly reduces the risk of errors.

Ensure you regularly back up your digital records. Utilise cloud storage so that you can access your data from any location. This is useful during inspections or when you are travelling for catering assignments.

Monthly checks:

• Ensure that all invoices are correctly filed.
• Compare your turnover with your VAT return
• Check whether all purchase invoices have been registered.
• Ensure that private and business matters remain separate

A structured approach makes VAT administration for your catering business much clearer. You have more time for your core business and less stress about your financial obligations. At Catermonkey, we help catering companies digitise their entire administration, from quotation to invoice, so you can focus on what you do best: providing excellent catering.

Plan your brainstorming session with Catermonkey!

Do you have questions about VAT rules for your catering business or would you like to know how to optimise your administration? Feel free to come to us with your ideas or challenges! Catermonkey is happy to help you figure out how the platform can support your business in efficient and correct VAT handling.

Plan your brainstorming session with Catermonkey! Book your no-obligation brainstorming session here and discover how we can help your catering business grow.