As announced in the Budget of 3rd March 2021, the temporary reduced rate applicable to the hospitality sector has been extended. This relief was originally introduced to support the hospitality and tourism industry during the ongoing coronavirus pandemic and was due to end on 31st March 2021. As announced by the Chancellor yesterday this has now been extended a further six months to 30th September 2021.
Furthermore, from 1st October 2021 a new reduced rate of 12.5% will be applicable to relevant supplies for a further six month period, with a return to the standard rate of 20% planned from 1st April 2022 completing a phased return to pre-coronavirus VAT treatment. The supplies affected by these temporary reduced rates are unchanged.
If you or your client operate in the sectors affected by this announcement and require clarification whether your supplies will be subject to a temporary VAT reduction as well as the impact accounting for VAT at these various rates may have on your business, please call our free VAT helpline for expert advice.
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