Since July 2020, the Government has temporarily reduced the VAT rate to 5% on certain supplies relating to hospitality, hotel and holiday accommodation and admissions to certain attractions.

In the Budget announced earlier this year, this temporary rate was extended until 30 September 2021 but, as of 1 October, a new VAT rate of 12.5% will be introduced.

This new rate will continue until 31 March 2022, at which point we expect the VAT rate to return to the standard rate of 20%.

For more detailed guidance from HMRC, please click here to be redirected to GOV.UK.

Credit Notes

If you raise a sales invoice or receive an advance payment at the 5% rate of VAT before 1 October 2021, which is then adjusted after this date (for example an order cancellation or price adjustment), the VAT rate for the credit note will be based on the rate originally charged.

For more information about this, click here to be redirected to HMRC's guidance on credits and debt.

We are here to help...

We are here to help in any way we can - please get in touch with us on 0121 693 5000 (Solihull Office), 01527 833124 (Bromsgrove Office) or 01675 466344 (Coleshill Office).