The Government has announced a temporary reduction in VAT from 20% to 5% on certain children's meals, children's admission tickets and admissions to qualifying family attractions between 25 June 2026 and 1 September 2026.
The measure is designed to support families during the summer holidays and is likely to be welcomed by them. But for businesses across the leisure and hospitality sector it is likely to be a further complication.
What qualifies for the reduced rate?
The temporary 5% VAT rate applies to:
- Children's meals that are specifically marketed and sold as children's meals by restaurants, cafés and similar establishments for consumption on the premises.
- Children's tickets for cinemas, theatres, concerts, exhibitions and shows.
- Admission tickets to qualifying family attractions, including theme parks, zoos, soft play centres, adventure parks and other eligible family attractions.
One particularly important point is that the reduced rate applies to the admission of a family ticket which includes one or more children. This means the reduced rate applies to the whole ticket including any adult admissions in that package.
Why does this matter?
Operators may choose to pass some or all of the VAT saving on to customers through lower prices, use it to help offset rising costs, or adopt a combination of both approaches.
For family attractions and hospitality businesses, the measure could help encourage additional visitor spending during one of the busiest periods of the year.
Practical considerations for businesses
Businesses affected by the change should review:
- Pricing structures and promotional materials.
- Point of sale, booking and ticketing systems.
- VAT coding within accounting software.
- Staff training and customer communications.
- Advance bookings and prepayments that relate to visits during the qualifying period, as special VAT timing rules may apply.
As the reduced rate only applies for a limited period, businesses should also prepare for the return to the standard 20% VAT rate from 2 September 2026.
Final thoughts
While temporary, this VAT reduction has the potential to encourage family spending during the summer holidays but does add complexity for affected businesses.
Businesses that may be affected should take the opportunity to review their pricing, systems and VAT treatment ahead of the changes taking effect on 25 June 2026.
