Bookkeeping Bites – How is the 5% VAT Cut Working for You?

💥 How is the 5% cut in hospitality VAT going for you? 💥 Is the cut saving you pennies for your piggy bank? 💥

There is no doubt that the INTENTION behind Dishy-Rishi’s was to….

🌞 Va-Va-Voom the customers back to restaurants, hotels, camp sites and attractions

🌞 DRIVE discounts to customers to get them spending again

🤓 BUT! Is this happening? 🤓

Did you know? Such businesses are NOT obliged to pass on the reduction in VAT to you?

Why? Well they may choose to use the VAT reduction to get much needed pennies back in their own, very dry and barren coffers……

🤓 Y’know, the price of a coffee is £2.00 before the VAT cut, and they pay £0.33p in VAT for every one they sell….

🤓 Now? The price is still £2.00 and they will pay £0.10p in VAT for every one they sell….

😍 Benefit to them? £0.23p clawed back for their piggy bank AND custom…

😍 Benefit to you? Apart from the warm fuzzy feeling of helping a business back on their feet (❤️ very important by the way ❤️), NIL.

The morale of the story is that the VAT reduction does not mean an AUTOMATIC reduction in your end bill………..

But the custom you are bringing, may just be get a business back on their feet again.

To read more, check out this article on Money Saving Expert:

https://www.moneysavingexpert.com/news/2020/07/vat-cut-to-5–for-hotels-and-attractions—will-you-get-a-discou/

Or if you want to check out Big G’s guidance on the VAT cut, check out this link:

https://www.gov.uk/guidance/vat-reduced-rate-for-hospitality-holiday-accommodation-and-attractions

Hope this helps, stay safe everyone 😍😍😍

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