Rajkiran Arhestey successfully represented HM Revenue & Customs (HMRC) in the First-tier Tribunal case Telamara Limited v The Commissioners for HMRC [2025] UKFTT 01123 (TC).
The dispute centred on whether nitrous oxide (N₂O) canisters—used for culinary purposes such as whipping cream—qualify as “food” under VAT legislation. Telamara Limited argued that N₂O should be zero-rated for VAT, citing its use as a food additive (E942), its alleged nutritional value, and its Halal certification.
HMRC countered that N₂O does not meet the statutory definition of food. It is not nutritious, has no perceptible taste or smell, and is not sold in supermarkets or to retail consumers. Instead, it is supplied in bulk to catering businesses and functions primarily as a propellant.
The Tribunal agreed with HMRC, concluding that N₂O is more comparable to gases used in beer production (which are standard-rated) than to ingredients like bicarbonate of soda (which may be zero-rated). It agreed with HMRC’s submissions that nitrous oxide has no nutritional value, cannot be eaten or drunk and is imperceptible once released from the canisters.
The appeal was dismissed, and Telamara Limited was ordered to pay the assessed VAT liability of £1,477,581.86.
Read the full judgment here. The case has also been covered in the Financial Times.
