A practical guide: the temporary ‘Great British Summer’ reduced rate of VAT 2026

The government announced last week that certain ‘eligible activities’ will benefit from the reduced rate of VAT.  As ideological as this may have sounded in the senior parliamentary discussions, we recognise the reality of having 5 weeks to prepare for a reduced rate which itself only lasts for 9 weeks is likely quite stressful for affected organisations.

To help, we have explained some of the key measures and the practical implications below:

 What are ‘eligible activities’?

• Childrens’ meals (dine in only)

• Childrens’ cinema, theatre, show, exhibition or concert tickets

• Tickets for right of admission for ANY customers (adult or children) to the following venues:

  o   amusement parks and fairs, including water parks and theme parks (excluding pay-per-ride attractions)

  o   circuses

  o   adventure parks, including outdoor adventure centres

  o   museums and similar cultural facilities, including planetariums, heritage sites, nature reserves and botanical gardens

  o   zoos, aquariums, wildlife parks and farm visitor attractions

  o   soft play centres, indoor bounce parks and indoor play facilities

  o   observation attractions, including viewing platforms, towers and observation wheels
  

When will it apply (the relief period)?

The reduced rate will apply to supplies with a ‘tax point’ between 25 June 2026 and 1 September 2026 inclusive.  The tax point rules themselves can be tricky to navigate, but HMRC’s guidance here could be useful if you’re not sure.

What if we supply bundles (i.e. supplying admission, meals and tickets together with other goods and services)?

The rules on whether something is a single or a mixed supply for VAT purposes are notoriously complex.  The usual rules will apply here, so if you have a single supply and it falls within the parameters of the ‘eligible activities’ the reduced rate will apply.

What happens if I have already sold tickets relating to the relief dates?

You can choose to retrospectively apply the reduced rate to sales relating to eligible activities within the applicable period by adjusting the VAT account, but it is expected that any refund of the additional VAT is issued to your customer.

What if tickets are for a period which allows re-entry outside of the relief dates?

VAT should be charged at the standard rate if the ticket will allow re-entry outside of the relief period, unless the ticket is the same price as a single day entry ticket.  If all repeat visits are only allowable within the relief period (25 June 2026 and 1 September 2026), the ticket will qualify for the reduced rate of VAT.

What if I sell a ticket in that period which relates to entry outside of that period?

If for example you sell an admission ticket for an eligible activity on 1 September 2026 relating to entry on 2 September 2026, you will need to account for VAT at the standard rate.

What if adults order and eat children’s meals?

As long as it is held out for sale for children, presented, marketed and priced in a way that is clearly for children (for example, smaller price, portion and on a child’s menu) it will be eligible for the reduced rate, regardless as to who consumes the food.

What if I am supplying a child’s meal for the customer to take-away?

This will continue to be standard rated (if hot food), only meals supplied for consumption on premises (at café, restaurant or similar establishment) will be liable to the reduced rate of VAT.  Cold take-away food will remain zero-rated.

Do we need to pass the saving on to our customers?

There is nothing to suggest you have to (except if you are retrospectively adjusting the VAT to the lower rate for a prepaid eligible activity; you are expected to refund the customer for the difference in this case)

What changes do we need to make in the business?

Of course, this will be variable by business.  But as a start, you’ll need to think about updating your electronic point of sale (EPOS) systems for the variables and potentially different rates applying to your supplies.  You’ll need to ensure any amends are linked to the finance system, to ensure the VAT account is adjusted correctly for each of the supplies.  You’ll need to consider whether you’re updating pricing, and if so, all of the places where you might need to amend temporarily (websites, menus etc).

Do we have to adjust our prices?

No, you can leave prices as they are if you wish to.  The temporary reduced rate will apply to eligible supplies (and so there is an opportunity for you to increase your profit margin or pass the reduction on), but there is not a requirement for this to be passed on to customers. You could for example pass some of the saving on to customers by reducing the price slightly and retain some of the financial benefit in the business.

Our supplies of admission are VAT exempt; do we need to start charging VAT?

In simple terms, no.  Supplies which are already exempted (for example, covered by the cultural VAT exemption) will not be affected by these measures.

 I don’t know if my supplies will be eligible for the relief, what can I do?

There are many different businesses and supplies that will be affected by the temporary relief, and we appreciate the practicality of implementing this change so quickly will be tricky.

If you have any questions about the relief and how it might apply to your supplies, you can reach out to us for a free initial advisory meeting or send us an enquiry and we’ll get back to you.