Summary

The temporary VAT rate for the hospitality, holiday accommodation and attractions sectors is coming to an end and will be replaced from 1 October 2021 with a reduced rate of 12.5%.

Description

The temporary VAT rate of 5% for the hospitality, holiday accommodation and attractions sectors, which has applied since 15 July 2020, is coming to an end. It’s due to be replaced from 1 October 2021 with a reduced rate of 12.5%. This new rate applies until 31 March 2022 and affects:

  • Supplies of food and non-alcoholic drinks for consumption on premises from restaurants, pubs, bars, cafes and similar premises in the UK.
  • Supplies of hot takeaway food and hot takeaway non-alcoholic drinks.
  • Supplies of hotel and holiday accommodation and admission to certain attractions in the UK.

You can find out more about the changes on Gov.uk >

If your business is affected, for further information about how to handle these changes in your software, please visit the Legislation Hub > 

Who’s affected by the changes?

These changes affect:

  • Restaurants, pubs, bars, cafes and similar premises across the UK.
  • Suppliers of accommodation and attractions in the UK.
  • VAT registered businesses purchasing from the above suppliers.

When are the changes happening?

The changes are temporary and apply from 15 July 2020 until the end of September 2021, when an interim rate of 12.5% will be introduced for a further 6 months. The standard rate of 20% will apply from April 2022.

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