New VAT Rate of 12.5% from the 1 October 2021
Summer 2020 the government announced a temporary reduction of VAT to 5% on supplies relating to:
- Hospitality
- Hotel and holiday accommodation
- Admissions to certain attractions
The temporary reduced rate originally applied to supplies that were made between 15 July 2020 and 31 March 2021. But in the 2021 Budget the chancellor announced this was to be extended to the 30 September 2021 with a revised rate after this.
1 October 2021 to 31 March 2022 the VAT rate will be 12.5%, hospitality businesses need to be preparing now for this change coming into force.
For full details of the current/future rates and more information on which business sectors this applies to, follow the link to the government website below –
https://www.gov.uk/guidance/vat-reduced-rate-for-hospitality-holiday-accommodation-and-attractions
