With all the other VAT events occurring (MTD becoming compulsory, zero-rating of the installation of energy saving materials, etc.) it may have slipped your mind that April 1 is the date that supplies currently subject to the reduced rate of 12.5% (catering, hospitality, etc.) will revert to 20%.
We were waiting to see if this proposal was to be amended in the Spring Statement but no such proposals were announced.
Equally, whilst some rate changes have been “delayed” until the small hours of the morning (e.g. 3am) for late night establishments there has been no such announcement for this change so we must assume it occurs at midnight on 31 March.
A brief summary of where the 12.5% VAT rate temporarily applies:
The temporary reduced rate covers supplies of meals and non-alcoholic drinks eaten in, hot takeaway foods and hot takeaway drinks. Cold takeaway food continues to be subject to 20% VAT or 0% VAT under the existing rules.
Sleeping accommodation in hotels, guest houses, B&B, self-catering holiday homes/chalets, caravans, camping rentals and pitch fees.
Deposits and VAT invoices:
The receipt of a deposit/full payment creates a tax point for VAT purposes. So payments received before 1 April will have the 12.5% rate applied even if the event takes place after 1 April.
Issuing a VAT invoice, on which the full amount to pay is included, will create a tax point for the full value of the supply. Issuing VAT invoices in advance of an event that is to begin on or after 1 April 2022, would enable the 12.5% VAT rate to be applied.
Admission to certain attractions
Admission to shows, theatre productions, circuses, fairs, amusement parks, concerts, museums, zoos, cinemas and exhibitions.
The temporary reduced rate does not apply to admissions that are normally exempt from VAT under the existing cultural exemption. Such admissions would therefore continue to be VAT-exempt.
For any assistance please contact a member of the RL VAT Team.
If you have any questions about the above, or would like more information specific to your circumstances, please enter your email address below and we will get in touch: