13/07/2020
VAT Guidance – Hospitality and Tourism
The latest guidance regarding the reduction to the VAT rate for the hospitality and tourism sector has been published.
The headline change is a reduction to the VAT rate to 5% for certain supplies of hospitality, hotel and holiday accommodation, and admissions to certain attractions. The temporary reduced rate will apply to supplies that are made between 15 July 2020 and 12 January 2021.
The legislation is due to be called “The Value Added Tax (Reduced Rate) (Hospitality and Tourism) (Coronavirus ) Order 2020”, but this has not yet been published by Parliament.
However, we have now received plenty of updated guidance:-
- Revenue and Customs Brief 10 – Policy paper: Guidance on the temporary reduced rate of VAT for hospitality, holiday accommodation and attractions
- Guidance: VAT: reduced rate for hospitality, holiday accommodation and attractions
- Guidance: VAT on admission charges to attractions
HMRC have also updated their VAT Notices:-
- Notice 709/3: Hotels and holiday accommodation
- Notice 709/5: Tour Operators Margin Scheme
- Notice 742: Land and Property
- Notice 701/14: Food products
- Notice 709/1: Catering, takeaway food
Fortunately the reduced rate seems likely to apply to all of the supplies made by the hotels, with the exception of alcoholic drinks, which remain subject to VAT at 20%.
There is also the “Eat Out to Help Out Scheme”, but this does not come into existence until 3 August.
For further information on VAT reduced rate, please contact Alan Rolfe on 023 8046 1235.
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