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bigduckontax, Accountant
Category: Tax
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My company provides accommodation, transport and guided

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Hello, my company provides accommodation, transport and guided activities sold as a package in the UK. Please can anyone tell me what current rate of VAT I should apply? is it the temporary reduced 5% VAT because we operate in the hospitality and tourism sector? Thanks
JA: When was the property or asset sold?
Customer: Hi its a service
JA: Is there anything else the Accountant should know before I connect you? Rest assured that they'll be able to help you.
Customer: no

The current rate of VAT is 20%, unchanged for years. Post Brexit though sales outside the UK are exports, zero rated supplies.

Customer: replied 16 days ago.
Thanks for this. I thought the VAT cut for hospitality, accommodation and tourism would apply until 310 Sept 2021,
I'm selling the package to people in Germany but they will be coming to Scotland to enjoy the service so do I still need to charge them VAT? Thanks

As announced at budget 2021, the government will be legislating to:

  • extend the temporary reduced rate of VAT of 5% until 30 September 2021
  • prepare for a new rate of 12.5% from 1 October 2021 to 31 March 2022

The supplies to which the temporary reduced rates will apply remain the same.

Customer: replied 16 days ago.
Thank you for confirming that. I'm unclear if my supplies qualify. I will be selling accommodation and a guided deer stalking experience which includes transport. Do you think these supplies have the temporary reduced rate or do you know where I would be able to get further advice on this?

You need to establish that you’re providing accommodation in a hotel, inn, boarding house or similar establishment. The reduced value rule does not apply to holiday accommodation, There is a danger here that your activities will not embract these parameters and in that case the 20 rate would apply.

Customer: replied 16 days ago.
OK so I'll be providing accommodation in a boarding house as meals will be provided. Based on your comments I'm thinking that I will need to Invoice the customers with itemised supplies rather than a package i.e. Accommodation and food £XXX + 5% VAT
Guided Deer Stalking and Transport £XXX + 20% VAT
Does that look appropriate?

Yes, indeed, what a palaver, bet you wish you hadn't started the whole caper!

bigduckontax and other Tax Specialists are ready to help you
Customer: replied 16 days ago.
haha well the VAT is certainly troubling me . Thanks very much for your help and advice

Delighted to have been of assistance.