New reduced VAT rate introduced in the UK for the hospitality sector

26 October 2021

The UK tax authorities have introduced a new reduced VAT rate on hospitality services of 12.5%.

The new rate replaces the temporary reduced VAT rate of 5%, which was introduced to help the UK hospitality sector recover from the impact of COVID-19. This new rate was introduced on 30 September 2021 and ends 31 March 2022 where the VAT rate will return to its original 20%.

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