15% VAT rate extended for New Year’s Eve traders

On the 1st Of January 2010 the VAT rate is due to go back to its original rate of 17.5%.

As this transit might prove to be difficult for certain businesses that trade on New Year's Eve after midnight, HMRC is allowing them to charge the 15% VAT rate the next day.

According to HMRC ,businesses that remain open on New Year's Eve like pubs, clubs, restaurants, shops etc will be able to charge customers VAT at the 15% rate until 6am the next day.

Financial Secretary to the Treasury said:
“New Year’s Eve celebrations are a vital source of income for many in the service sector. The Government recognises that it would be very difficult for them to make the necessary changes to account for VAT at 17.5% immediately after midnight. To make the transition as easy as possible retail and telecommunication businesses will be able to charge VAT at the old rate into the early hours of New Years Day"


For more information, Taxfile welcomes you to follow this link on the HM Revenue and Customs website.