What VAT rate does a café charge in Ireland? Coffee, food and drinks from 1 July 2026

From 1 July 2026, Revenue says restaurant and catering services are at the second reduced rate of VAT, and so are hot takeaway food and hot coffee and tea. Revenue's table of rates, dated 1 January 2026, lists the second reduced rate as 9%, the reduced rate as 13.5% and the standard rate as 23%. Hot coffee and tea are at the second reduced rate whether the customer drinks in or takes away. Alcohol, bottled water, soft drinks, sports drinks and vegetable juices stay at the standard rate, even when served as part of a restaurant service. Some takeaway items are taxed differently from the same item eaten in, so the table below matters.

What VAT rate does a café charge in Ireland?

The second reduced rate, 9%, applies to restaurant and catering services from 1 July 2026, according to Revenue. Revenue's page on restaurant, catering and canteen services says: "In general, restaurant and catering services are liable to Value-Added Tax (VAT) at the reduced rate until 30 June 2026. From 1 July 2026, the second reduced rate of VAT applies."

Revenue's page on current VAT rates gives the percentages in a table. Its row dated 1 January 2026 reads: standard rate 23, reduced rate 13.5, second reduced rate 9. That row predates the 1 July 2026 change. Revenue's guidance on restaurant and catering services is what moves them to the second reduced rate on 1 July 2026, and it uses the words "second reduced rate", not a percentage. Putting the two together gives 9%. The same manual says hot takeaway food moves to the second reduced rate on the same date.

The manual is "provided as a guide only and is not professional advice", in Revenue's own words, and was last reviewed in June 2026. Our article on Budget 2027 and cafés covers the 9% rate becoming permanent from 1 July 2026.

What was the VAT rate for cafés before 1 July 2026?

It was the reduced rate, 13.5%, from 1 September 2023 to 30 June 2026. Revenue's footnotes in its restaurant and catering manual say: "For the period 1 September 2023 to 30 June 2026 the reduced rate applies. For the period 1 November 2020 to 31 August 2023 the second reduced rate applies."

So the second reduced rate applied from 1 November 2020 to 31 August 2023, then the reduced rate applied, and from 1 July 2026 the second reduced rate applies again.

Is a coffee to go taxed differently from a coffee drunk in?

No. Revenue's table lists "Coffee, Tea (Hot)" at the second reduced rate in the restaurant or catering column and at the second reduced rate in the takeaway column, from 1 July 2026. The split between eating in and taking away matters for other items. These rows come from section 8 of the manual, "Summary table: Rates applicable from 1 July 2026", with the percentages from Revenue's rates table in brackets.

From 1 July 2026: eat in vs takeaway	Restaurant/Catering service (eat in)	Takeaway
Coffee, Tea (Hot)	Second reduced (9%)	Second reduced (9%)
Cold Sandwich	Second reduced (9%)	Zero (0%)
Hot Sandwich	Second reduced (9%)	Second reduced (9%)
Cakes, biscuits (other than chocolate covered biscuits)	Second reduced (9%)	Reduced (13.5%)
Chocolates, Confectionery, Crisps, Ice cream, Biscuits - chocolate covered	Second reduced (9%)	Standard (23%)
Fruit juices	Second reduced (9%)	Standard (23%)
Alcohol, bottled waters, soft drinks, sports drinks and vegetable juices	Standard (23%)	Standard (23%)
Coffee, Tea with scone/ cake	Second reduced (9%)	Second reduced & Reduced (9% and 13.5%)

What makes a sale a restaurant service rather than a takeaway? Revenue says restaurant services are "accompanied by sufficient support services allowing for the immediate consumption thereof", and are "the supply of such services on the premises of the supplier". Its list of the elements includes a dining room with cloakroom, furniture and crockery, and staff who lay the table, advise the customer, serve at the table and clear it.

For takeaways, the manual says supplies from "a fixed establishment or a mobile snack bar" are generally a supply of goods. It lists factors that may show it is not a restaurant service, among them "no table service", "no crockery, furniture or place settings" and "the lack of other service elements". It adds that "counters enabling a limited number of customers to eat on the spot where there is negligible human intervention will not alter the nature of the supply." If your set-up sits between the two, ask Revenue or an accountant which side you are on. The article on coffee vans covers takeaway from a vehicle.

What about iced coffee, soft drinks and bottled water?

Soft drinks and bottled water are at the standard rate, 23%, even eaten in, and Revenue's one example that names iced coffee, a retail shop, puts it at the standard rate too. Revenue's restaurant manual says: "supplies of alcohol, bottled waters, soft drinks, sports drinks and vegetable juices (excluding fruit juices) are liable to VAT at the standard rate even when provided as part of a restaurant service."

Iced coffee is not named in that list. It appears in Revenue's separate manual on food and drink sold by wholesalers and retailers. Its Example 3 describes a retail shop that supplies an iced tea, an iced coffee and a toasted cheese panini: "The iced tea and iced coffee are both chargeable to VAT at the standard rate. The hot panini is chargeable at the second reduced rate." That is Revenue's retail shop example, not a café one, so I would not read more into it than it says. Ask Revenue or your accountant how it applies to your menu.

Milk is a separate point. Revenue's retail manual says milk is zero rated, and that a concession for milk-based drinks, where milk is more than 50% of the volume, "does not apply to tea, herbal tea, cocoa, coffee, chicory and other roasted coffee substitutes."

What about a coffee with a scone or cake?

Eaten in, both are at the second reduced rate. Taken away, they are split: Revenue's table gives "Coffee, Tea with scone/ cake" as "Second reduced & Reduced". The table does not say which item takes which rate, but its other rows put hot coffee taken away at the second reduced rate (9%) and cakes taken away at the reduced rate (13.5%), which is how I read the split. A coffee with confectionery taken away is "Second reduced & Standard".

Where a café sells a combination at one price, Revenue says in its section on meal deals that a discount "should be apportioned between the individual items of the meal at their appropriate rates of VAT". Its example is hot food together with a soft drink sold for a single price, usually at a discount.

Does delivery change the VAT rate?

The delivery itself is charged separately, at the standard rate. Revenue says "Delivery services are subject to VAT at the standard rate," and that where food or drink is delivered, the delivery service is "not, generally, considered ancillary to the supply of the food or drink". The manual also says a takeaway or food delivery service by a restaurant "is not regarded as a restaurant service and will therefore attract a different VAT treatment".

When does a café have to register for VAT?

Revenue says registration "is obligatory when your annual turnover exceeds the VAT thresholds", and that below a threshold you may elect to register. Revenue's page lists €42,500 for persons supplying services only and €85,000 for persons supplying goods. It also lists €85,000 for those supplying both goods and services where 90% or more of turnover is from goods, and €42,500 for goods liable at the reduced or standard rates that you have manufactured or produced from zero rated materials.

I cannot tell you which of those applies to a café, and the Revenue page does not say. Ask Revenue or an accountant which threshold applies to your business. Revenue's page also says annual turnover is calculated excluding VAT, over a calendar year.

Sources

• Revenue, Current VAT rates, published 1 January 2026, read 11 October 2026.
• Revenue, Tax and Duty Manual, VAT Treatment of Restaurant and Catering Services, last reviewed June 2026, read 11 October 2026.
• Revenue, Tax and Duty Manual, VAT on Food and Drink Supplied by Wholesalers and Retailers, read 11 October 2026.
• Revenue, Restaurant, catering and canteen services, published 7 May 2026, read 11 October 2026.
• Revenue, What are the VAT thresholds?, published 6 May 2026, read 11 October 2026.

This is a summary of Revenue's published guidance, read 11 October 2026, not tax advice. Check with Revenue or your accountant. Cupán Studio builds websites for cafés in Ireland.