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Temporary reduced rate of VAT for hospitality, holiday accommodation and attractions

HMRC has provided further guidance regarding the changes in the VAT treatment of certain supplies of hospitality, hotel and holiday accommodation and admission to certain attractions announced on 8 July 2020. The changes take effect from 15 July 2020.

These changes are being brought in as an urgent response to the COVID-19 pandemic to support businesses severely affected by forced closures and social distancing measures.

What are the changes and who do they apply to?

Organisations that make supplies of hospitality, hotel and holiday accommodation and admission to certain attractions, and their advisers are affected.

This cut in the VAT rate from the standard rate of 20% to 5% will have effect from 15 July 2020 to 12 January 2021.

What are the affected supplies?

The following supplies will benefit from the temporary 5% reduced rate of VAT:

  • Food and non-alcoholic beverages sold for on-premises consumption, for example, in restaurants, cafes and pubs
  • Hot takeaway food and hot takeaway non-alcoholic beverages
  • Sleeping accommodation in hotels or similar establishments, holiday accommodation, pitch fees for caravans and tents, and associated facilities
  • Admissions to the following attractions that are not already eligible for the cultural VAT exemption such as: theatres, circuses, fairs, amusement parks, concerts, museums, zoos, cinemas, exhibitions and similar cultural events and facilities.
Disclaimer

The information was correct at time of publishing but may now be out of date.

Tax
Posted by Carolyn Van Hecke
14th July, 2020
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