Hotels and hospitality firms must now account for VAT on any income from providing living accommodation for employees, including on payments made via salary sacrifice schemes, under changes announced by HMRC
Other VAT changes mean that firms letting rooms to guests for more than 28 consecutive days, now no longer have to charge VAT on income from the 29th day onwards. Pub trade accountant David Jones urged hospitality firms to ensure they are up to date with the changes to VAT rules. If a staff member pays for accommodation for food and drink, the money received will be treated as including VAT and must be accounted for on VAT returns. This means that firms could be worse off by almost 20 per cent unless they increase the charges they make to staff.
If you require assistance with your VAT returns contact Davenports Accountancy today on 0845 351 0381
Story from Federation of Small Businesses