The Government is implementing a new initiative during the 2026 summer holidays “Great British Summer Savings”. The aim is to make summer activities more affordable and encourage spending within the leisure and hospitality sectors.
This initiative provides a welcome boost for both families and businesses. However, as with many VAT changes, the detail matters.
As part of this scheme, a temporary reduced rate of VAT will apply to certain goods and services between 25 June 2026 and 1 September 2026.
What is changing?
During this period, VAT will be reduced from the standard 20% rate to 5% on specific supplies aimed at families and children.
This includes:
- Children’s menu meals in cafés, restaurants and similar venues
- Children’s tickets for cinemas, theatres and entertainment venues
- Admission to family attractions such as soft play centres, adventure parks and theme parks
Who does this affect?
This change is particularly relevant for entities in:
- Hospitality (restaurants, cafés, pubs)
- Leisure and entertainment (cinemas, theatres, attractions)
- Family-focused activity providers
Any VAT registered entity supplying qualifying goods or services during the period will need to consider whether it should apply the reduced VAT rate.
Key VAT considerations
Although the headline change is simple, there are important technical points to consider:
- Eligibility of supplies
Not all income streams will qualify. Entities must review whether their offerings fall within the scope of the reduced rate. - Mixed and bundled supplies
Where a transaction includes both eligible and non-eligible items (for example, a family package or meal deal), the VAT treatment may need to be apportioned correctly. - Timing (tax point rules)
The VAT rate applied depends on when the supply is deemed to take place. This is particularly important for:
- Advance bookings
- Deposits
- Tickets sold before or after the qualifying period
What should those affected by the changes do now?
With the scheme starting on 25 June 2026, affected entities should act quickly to prepare.
Recommended actions include:
- Reviewing all relevant income streams
- Identifying which qualify for the reduced rate
- Updating systems and processes
- Communicating changes internally
How we can help
The rules around VAT can become complex, particularly where supplies are mixed or where bookings span different VAT periods.
If you operate in hospitality, leisure or entertainment, it is worth taking advice and if you would like support reviewing your position, please contact our team – call 01242 776000 or email Tax@randall-payne.co.uk.