A London-based company producing a popular anti-ageing collagen drink has lost a legal bid to reclaim more than £3.6 million in value-added tax (VAT). Minerva Research Labs Ltd, which makes Gold Collagen Pure, the UK’s top-selling collagen supplement, challenged the classification of its products for tax purposes, arguing they should be zero-rated as food rather than taxed as health supplements.

Founded in 2009 by entrepreneur Tony Sanguinetti, Minerva Research Labs develops collagen supplements derived from cow hides and sardine scales. The company, with an annual turnover of approximately £16 million, promotes its products as delivering nutritional benefits for skin, hair, joints, and muscles. High-profile endorsers include model Yasmin Le Bon, TV presenter Charlotte Hawkins, and former Olympic athlete Dame Denise Lewis.

In 2022, Minerva requested a refund of about £3.6 million, covering VAT paid since 2018. The firm contended that its collagen drinks should be treated as food products providing healthy nutrition and therefore exempt from VAT under UK tax regulations. HM Revenue & Customs (HMRC) denied the claim, and the company subsequently appealed the decision to the First-tier Tribunal.

During the tribunal, Minerva argued its drinks are consumed to provide nutritional building blocks rather than as medicinal products. The legal question centered on whether the collagen drinks qualify as “food of a kind used for human consumption,” which would warrant zero VAT.

Judge Anne Redston, presiding over the tax chamber of the tribunal, ruled against Minerva’s challenge. She noted that the products were not marketed or intended to be used as a meal or snack and that their pleasant taste did not imply they were purchased as food. The judge emphasized that the key issue was the proper tax classification of the drinks, concluding they did not meet the criteria for zero rating as food.

This decision confirms the application of VAT to the company’s collagen supplements and affirms HMRC’s original classification. Minerva Research Labs is now liable for the full tax amount previously paid at the standard rate, with no reduction for their nutritional claims.