VAT on Delivery Commissions Guide

How this tool works

VAT on delivery commissions is one of the most commonly miscoded items in restaurant accounting. Platforms charge 20% VAT on their commissions — this is input tax that VAT-registered businesses can reclaim in full, because zero-rated food (cold takeaway items, certain bakery goods) is still a taxable supply and does not restrict recovery the way exempt supplies would. What your sales mix does affect is the output VAT split on the sales themselves, which needs apportioning by VAT rate. Most generalist accountants record delivery sales net of commission and miss the output-VAT split entirely. This tool works out the VAT on your weekly commission, confirms it is reclaimable in full whatever your standard-rated and zero-rated split, and shows what that reclaim is worth over a year. It does not split your sales by rate for you.