VAT: reduced rate for hospitality, holiday accommodation and attractions

As announced at Budget 2021, the temporary reduced rate which applied to tourism and hospitality ended on 31 March 2022.

From 1 April 2022 the normal VAT rules apply, and VAT should be charged at the standard rate.

For accounting purposes, the reduced rate had applied as follows:

5% from 15 July 2020 to 30 September 2021

12.5% from 1 October 2021 to 31 March 2022

The government made an announcement on 8 July 2020 allowing VAT registered businesses to apply a temporary reduced rate of VAT to certain supplies relating to:

The temporary reduced rate applied to supplies that were made between 15 July 2020 and 31 March 2022.

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

If you supply food and non-alcoholic beverages for consumption on your premises, for example, a restaurant, café or pub, you’re currently required to charge VAT at the standard rate of 20%. However, when these supplies were made between 15 July 2020 and 31 March 2022 you only needed to charge the reduced rate of VAT.

You were also able to charge the reduced rate of VAT on your supplies of hot takeaway food and hot takeaway non-alcoholic drinks.

More information about how these changes apply to your business can be found in Catering, takeaway food (VAT Notice 709/1).

You also benefited from the temporary reduced rate if you:

More information about how these changes apply to your business can be found in Hotels and holiday accommodation (VAT Notice 709/3).