The rate of VAT on food, accommodation and entry fees to attractions is scheduled to increase from 5% to 12.5% from 1 October 2021.

The rate was reduced to 5% in July 2020 as part of the government's package of measures to help businesses during the COVID-19 pandemic. Finance Act 2021 includes clauses to increase the rate to 12.5% between 1 October 2021 and 31 March 2022, with the standard rate of 20% due to return from 1 April 2022. These clauses can however be amended by Treasury Regulation should the Chancellor decide to extend the rate cut at any time.

The Reduced rate applies to supplies of:

  • Admissions to attractions that are not already eligible for the cultural VAT exemption including:
  • Sleeping accommodation in hotels or similar establishments, holiday accommodation, pitch fees for caravans and tents, and associated facilities.
  • Hot takeaway food and hot takeaway non-alcoholic beverages.
  • Food and non-alcoholic beverages sold for on-premises consumption, for example, in restaurants, cafes and pubs.
    • Theatres.
    • Circuses and fairs.
    • Amusement parks.
    • Concerts.
    • Museums and exhibitions.
    • Zoos.
    • Cinemas.
  • It does not apply to sporting events, or to alcoholic drinks which continue to be standard rated at 20%.

Useful guides on this topic

COVID-19: Reduced rate VAT
The temporary cut to the rate of VAT on food, accommodation and entry fees to attractions from 20% to 5%, introduced on 15 July 2020, is extended by Finance Act 2021 until 30 September 2021.

COVID-19: VAT payments
COVID-19 VAT payment deferral measures for VAT registered business.

Food: Catering and takeaway
There is sometimes confusion as to how food is treated for VAT purposes. If the food is purchased from a supermarket, one rule may apply. If the same food is bought from a café a different rule could apply.


Oak ad
Are you enjoying our content? 

Thousands of accountants and advisers and their clients use www.rossmartin.co.uk as their primary TAX resource.

Register with us now to receive our unique FREE Tax Planning Tips and Advice Guide & our FREE OMB Newsletter.

 

 

Comments (0)

Rated 0 out of 5 based on 0 voters
There are no comments posted here yet

Leave your comments

  1. Posting comment as a guest.
Rate this post:
Attachments (0 / 3)
Share Your Location

 

Enjoying the Practical Tax content on www.rossmartin.co.uk? 

Sign up now to receive a unique FREE Tax Planning Tips and Advice Guide & our FREE Newsletter.

.Squirrel ad