The Government has offered a range of concessions to taxpayers in response to the COVID-19 pandemic. However, none has been more valuable to museums, galleries and other visitor attractions (which also include theatres, cinemas, concert venues and amusement parks) as the new and temporary 5% reduced VAT rating for admission.

This was initially due to end on 12 January 2021 but has recently been extended until 31 March 2021. The Government is seeing this as an urgent response to the coronavirus pandemic to support businesses severely affected by forced closures and social distancing measures.

Ordinarily, an attraction must charge VAT at 20% to its customers on admission prices. The temporary concession reduces the 20% rate to 5%, offering customers an incentive to visit the attraction in difficult times. The reduced VAT rating is temporary only and is in force now between 15 July 2020 and 31 March 2021. It applies only to supplies of admission to specified types of attractions.

It’s important to understand that the concession only applies to admission tickets. Therefore, difficulties may arise where attractions are supplying other goods and services in addition to the general admission price. HMRC are clear that where certain goods, such as guide booklets, brochures, children’s activity packs, food and drink are included as part of the admission price and are “incidental” to the main supply of admission, then the full amount of the ticket would qualify for the 5% rating.

By contrast, if the provision of goods such as food and drink is the main purpose of the supply, then the reduced rating may not apply. Certain other attractions offered by businesses may qualify for the reduced rating such as factory tours, studio tours and botanical gardens. The nature and type of attraction will determine whether or not the reduced rating is in point.

An attraction therefore needs to consider carefully which of the goods and services it sells to the public qualify for this reduced rate and what is not affected. The position may not always be straightforward and appropriate advice should be sought for certainty on the position. 

This publication is intended for general guidance and represents our understanding of the relevant law and practice as at October 2020. Specific advice should be sought for specific cases. For more information see our terms & conditions.

Date published

05 October 2020