Many in the hospitality sector were hoping that the Chancellor would extend the 12.5% reduced rate that has applied since 1 October 2021 but, as scheduled, the rate has reverted to 20% from 1 April 2022.
The increase will apply to hospitality, visitor attractions and catering services including restaurants and takeaways.
VAT Flat Rate Scheme
This has a consequential effect on the VAT Flat Rate Scheme percentages from 1 April 2022 as set out below:
| Type of Business | Before 15 July 2020 & from 1 April 2022 | 15 July 2020 to 30 September 2021 | 1 October 2021 to 31 March 2022 |
| Catering services including restaurants and takeaways | 12.5% | 4.5% | 8.5% |
| Hotel or accommodation | 10.5% | 0% | 5.5% |
| Pubs | 6.5% | 1% | 4% |
Affected businesses should ensure that their pricing policies and internal systems and processes are updated for the 1 April 2022 change in VAT rate. Our VAT team can help with this.
if you need any assistance with this issue, please get in touch.