Complex admin requirements of temporary VAT rate cut

With some businesses now facing three or even four different VAT rates, Crowe’s Robert Marchant unpicks the implications of the temporary reduction, assessing the impact of further tax compliance for the hospitality and tourism industries

The temporary reduction to a 5% VAT rate for hospitality and tourism businesses, announced in the recent Summer Statement, provides a welcome boost to the sector. But, at the same time it demonstrates the quirky side of the VAT rules and the significant administrative requirements businesses have to deal with.

The reduced rates of VAT came into effect on 15 July 2020 and continue until 12 January 2021.

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