The government has announced that a reduced rate of VAT of 5% will apply from 25 June 2026 to 1 September 2026 (inclusive) to: 

• certain supplies of children’s meals;
• children’s admission to cinema screenings, theatrical performances (including shows and concerts) and exhibitions; and
• all admission tickets to certain attractions suitable for families with children.

The temporary reduced rate will be provided for by secondary legislation. In the meantime, HMRC has published Revenue & Customs Brief 5 (2026) explaining how the measure will work in practice. HMRC says that the Brief reflects the law as it is expected to apply once enacted. Supplies that are exempt from VAT are unaffected by the changes.  

It is made clear in the Brief that the reduced rate does not apply to sporting activities.  

Children’s meals 

For the reduced rate to apply, it must be the case that: 

• the meal is held out (ie, marketed, presented and priced) for sale only as a meal for children; and
• the meal is supplied as part of catering services by a restaurant, café or similar establishment for consumption on the premises. 

The Brief provides examples of circumstances in which the reduced rate will not apply, including meals marketed as smaller portions or having lower calories, and discounted versions of adult meals. 

Where the meal is supplied for a single inclusive price, for example, including a drink or dessert, the entire package can qualify for the reduced rate.

Children’s admission tickets

A ticket to a cinema screening, theatrical performance (including shows and concerts) or an exhibition will qualify for the reduced rate where the ticket is held out for sale:

• only as a right of admission for a child; or
• as a right of admission for a family which includes one or more children. In this case, the reduced rate applies to the whole ticket, including any adult admissions included within the package.

Admission to certain attractions

The reduced rate applies to charges made for a right of admission for any customers, regardless of age, to qualifying attractions that are suitable for families with children. Note that, in this instance, the reduced rate applies by reference to the nature of the attraction, and not to the age of the person receiving the supply.

Qualifying attractions include:

• amusement parks and fairs, including water parks and theme parks (excluding pay-per-ride attractions);
• circuses;
• adventure parks, including outdoor adventure centres;
• museums and similar cultural facilities, including planetariums, heritage sites, nature reserves and botanical gardens;
• zoos, aquariums, wildlife parks and farm visitor attractions;
• soft play centres, indoor bounce parks and indoor play facilities; and
• observation attractions, including viewing platforms, towers and observation wheels. 

The reduced rate of VAT for admission to qualifying attractions does not extend to goods or services supplied separately, for example, merchandise.

Challenges for businesses

These include:

• Updating materials, processes and systems. The timing of the announcement means that businesses have only a relatively short period in which to prepare. Some businesses may question whether the additional work and inconvenience is worth it for a relief that will last less than ten weeks.
• Dealing with boundary and other issues. It may not always be clear whether a supply qualifies for the reduced rate based on the guidance available so far, increasing the likelihood of errors. Businesses are advised to take particular care when determining if children’s meals fall within the scope of the reduced rate.
• Managing relationships with customers. Some businesses may decide not to pass on the full benefit of the reduced rate, particularly where the business has incurred costs in updating its processes and systems. Care is required in some circumstances, including where:
  • a ticket allows repeat entries outside of the period between 25 June and 1 September 2026; and
  • a ticket that permits admission for a date falling in that period has already been sold (prepayments).

The government says that it “would expect that where a customer has prepaid that they would be refunded for any additional VAT paid” but the Brief does not go as far as suggesting that there is an obligation for the business to do so.  

Calls for reform 

In its How to fix VAT campaign, ICAEW highlights the issues with the UK’s VAT regime and suggests ways in which it could be reformed. ICAEW continues to call for a simpler tax system, including moving over time to a single rate of VAT.