HMRC has updated its guidance on the temporary reduced rate of VAT applicable to children’s meals, family attractions and tickets.
Between 25 June and 1 September 2026, the rate of VAT on children’s meals and specific attractions is reduced from 20% to 5%.
The new guidance, issued on 27 July, includes additional details on party packages, prepayments and mixed supplies.
Image credit: Atlantic Ambience
The latest guidance also confirms that users of the flat rate scheme should continue to apply their current percentage to calculate their VAT liability, and that the temporary reduced rate doesn’t apply to margin scheme supplies under the tour operator’s margin scheme.
Paul Hornby, Managing Director of JF Hornby & Co, said: “This is precisely the sort of issue we warned about when the VAT reduction was first announced. What looked like a relatively simple measure on the surface has proved far more complicated in practice, which is reflected by HMRC having to revisit and clarify its guidance only weeks after implementation.
“For businesses already grappling with rising costs and administrative pressures, keeping up with changing tax guidance can be a challenge in itself. The key now is to make sure systems and records reflect the latest position to avoid problems further down the line.”
For advice linked to the temporary VAT reduction, call 01229 588077 or email jfh@jfhornby.com.
