Background

In July 2020 the UK Government announced a temporary reduced VAT rate of 5% for the hospitality, holiday accommodation and attractions sectors. This was to help businesses in these sectors during the COVID pandemic and applied to:

• 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.

The 5% rate was then replaced from 1 October 2021 with a reduced rate of 12.5% to apply until 31 March 2022.

What's changing?

This temporary reduced VAT rate ends on 31 March 2022. From 1 April 2022, supplies that came under the temporary reduced VAT rate return to the standard 20% rate. 

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

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