Navigating the temporary summer VAT reduction: a guide for hospitality businesses
If you run a restaurant, café, soft play centre, visitor attraction, cinema or family venue, a temporary VAT cut now applies to some sales over summer 2026. From 25 June to 1 September 2026 inclusive, qualifying children’s meals and certain family leisure admissions are charged at 5% VAT instead of the standard 20%.
The scheme is called Great British Summer Savings. It applies across England, Wales, Scotland and Northern Ireland, but it is narrow and time-limited. The standard rate applies again from 2 September 2026, so you need to set up the 5% rate correctly now and plan the switch back.
Here is what qualifies, what does not, and how to keep your records clean.
What the scheme covers, and what it does not
The reduced rate is not a blanket VAT cut for hospitality. It covers certain children’s meals, children’s and family tickets for some events, and admission for all customers to specified family attractions. You can read the official summary on GOV.UK, with the fine detail in Revenue and Customs Brief 5 (2026).
| Qualifies for 5% | Stays at 20% |
|---|---|
| Children’s meals from a children’s menu, eaten on the premises | Takeaway meals |
| Non-alcoholic drinks included in, or sold from, the children’s menu | Alcohol |
| Children’s or family tickets for cinema, theatre, concerts, exhibitions and shows | Adult-only tickets and standard adult admissions |
| Admission for all customers to qualifying family attractions | Sports events, sports facilities and physical recreation |
| Single-entry attraction tickets within the relief period | Merchandise, upgrades and separately sold extras |
If applying two rates across your menu feels fiddly, our guide to handling VAT in Xero shows how to set it up cleanly. If a busy summer pushes your taxable turnover towards the £90,000 VAT registration threshold, our note on crossing the VAT threshold is worth reading too.
Getting the children’s meals rule right
This is where mistakes happen. The 5% rate only applies where a meal is held out for sale as a children’s meal and supplied as part of catering services for consumption on the premises. In practice, that usually means it is marketed, presented and priced as a children’s meal, for example on a distinct children’s menu.
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If you are unsure about tax, bookkeeping, payroll, property accounts or business finances, speak to the team at FHP Accounting for clear, practical guidance.
A smaller portion of an adult dish does not automatically count. Neither does a shared plate, a discounted adult meal, or takeaway food. Say you run a family pub. Fish and chips from the children’s menu may qualify, but the same dish sold as a smaller adult portion may not.
Where you sell a children’s meal deal for a single inclusive price, such as a main, drink and dessert, the whole package can qualify. Non-alcoholic drinks that form part of the children’s meal can also qualify. Optional add-ons or upgrades from the standard menu should be treated under the normal VAT rules. Accurate day-to-day bookkeeping from the outset keeps this clean.
Tickets and advance bookings
For attractions and events, the date of admission matters. The 5% rate applies to qualifying admissions between 25 June and 1 September 2026. Tickets bought during the period for admission on or after 2 September remain standard-rated.
Children’s tickets for cinemas, theatres, concerts, exhibitions and shows can qualify. Family tickets that include at least 1 child can also qualify. Standalone adult tickets do not.
For family attractions, the relief can apply to admission for adults and children. This includes amusement parks, fairs, circuses, museums, zoos, soft play centres, adventure parks, farm visitor attractions, nature reserves, aquariums and observation attractions. It does not apply to sports events, use of sports facilities or participation in physical recreation.
Advance bookings need care. If a customer has already paid for a qualifying visit during the relief period, you may opt to apply the reduced rate under the change of rate rules. Where you have already accounted for VAT at 20% and choose to apply 5%, you need to adjust your VAT records. HMRC expects prepaid customers to be refunded any additional VAT paid. Our note on HMRC VAT inspections explains why that evidence matters.
Should you pass the saving on?
This is a commercial decision. The government expects businesses to pass on savings where they can, but the relief works through the VAT rate, not a mandatory price cut.
You may reduce prices to attract families, hold prices to protect margins, or use a mixed approach. With rising small business costs still affecting hospitality and leisure operators, the right answer depends on your pricing, staffing and summer demand. Our piece on protecting your margins sets out the trade-offs.
Getting your systems and records right
The admin is the real work. Your tills, EPOS, booking platform, menus and receipts all need the right VAT treatment for the period. Staff also need to know which items qualify. Then you need to reverse the setup from 2 September.
A tidy receipt capture workflow, accurate record keeping and Xero bookkeeping support make reconciliation far less painful. If your team is stretched, outsourced finance support can manage the VAT process for you, while accountants for new businesses can help newer venues set it up properly from day one.
Frequently asked questions
What is the Great British Summer Savings scheme?
It is a temporary VAT reduction from 20% to 5% on qualifying children’s meals and certain family leisure admissions, running from 25 June to 1 September 2026.
Does takeaway food qualify for the 5% rate?
No. The reduced rate for children’s meals only applies to qualifying meals served for consumption on the premises.
Do adult attraction tickets qualify?
They can qualify for specified family attractions, such as zoos, soft play centres and theme parks. Adult-only cinema, theatre, concert, exhibition and show tickets generally stay at 20%.
When does the reduced rate end?
The reduced rate applies until 1 September 2026 inclusive. The standard 20% rate applies again from 2 September 2026.
Get the VAT treatment right this summer
If you are unsure which of your sales qualify, or how to handle advance bookings and the switch back in September, speak to FHP Accounting. As Nottingham-based accountants, we help hospitality and leisure businesses apply the rules correctly and keep clean records. If you own the premises you trade from, our property tax accountants can help with the wider picture. Call 0115 648 8686 or get in touch for a free consultation.
I lead FHP Accounting, an accountancy practice specialising in Commercial and Residential Property Accounting. Our goal is to make the administration of running property portfolios easier for landlords, managers, and investors — allowing you to focus on what you do best, while we take care of everything behind the scenes.
Need Expert Accounting Advice?
If you are unsure about tax, bookkeeping, payroll, property accounts or business finances, speak to the team at FHP Accounting for clear, practical guidance.
