The standard rate of VAT is still 20% and no change to it has been announced. But two genuine VAT cuts sit either side of today: a 5% rate for children's meals and family attractions that ran from 25 June to 1 September 2026 and has now ended, and a zero rate on domestic electricity in Great Britain that starts on 1 October 2026. Both are temporary, and the second has a Northern Ireland carve-out.
The rates as they stand
Standard rate 20%, reduced rate 5%, zero rate 0%. The standard rate has been 20% since 4 January 2011. The registration threshold is £90,000 of taxable turnover and the deregistration limit £88,000, both unchanged since 1 April 2024.
Nothing in the last Budget changed a rate or a threshold. Its VAT measures were narrower: relief for business donations of goods to charity from 1 April 2026, taxi and private hire excluded from the tour operators' margin scheme from 2 January 2026, the standard rate applied to Motability lease top-up payments from 1 July 2026, and a cross-border VAT grouping change.
The cut that has just ended: children's meals and family attractions
A 5% rate applied in place of 20% for the period 25 June 2026 to 1 September 2026 inclusive. It is worth knowing about after the event because it affects returns still being filed and any credit notes or corrections now being processed.
What qualified:
- Children's meals — food for consumption on the premises where the food forms part of a children's meal;
- Child or family admissions to shows, exhibitions, theatres, concerts and cinemas;
- Admissions for both children and adults to circuses, fairs, amusement parks, adventure parks, soft-play centres, zoos, observation attractions, farm visitor attractions, nature reserves, museums and similar cultural facilities.
What did not: admissions to sports events and sports facilities, or events and facilities for physical education or recreation. Goods and services supplied separately — food bought outside a children's meal, merchandise, upgrades — kept their normal treatment. And season or repeat-entry tickets valid outside the window did not qualify unless priced the same as a standard single-entry ticket.
The relief was introduced by SI 2026/576, which inserted Groups 17 and 18 into Schedule 7A VATA 1994, and applied across England, Wales, Scotland and Northern Ireland.
The cut that starts on 1 October: domestic electricity
This is the one to act on. From 1 October 2026 to 31 March 2027, qualifying supplies of electricity are zero-rated — down from the 5% reduced rate that currently applies to domestic fuel and power.
Three features matter:
- Great Britain only. The order does not apply to supplies in Northern Ireland, where the 5% reduced rate continues. A supplier operating across the UK has two rates to run for six months;
- Electricity, not gas. The published guidance addresses electricity; gas is not in scope of this relief;
- Qualifying use — electricity supplied for domestic use, or for a charity's non-business use, on the usual qualifying-use tests.
On bills straddling 1 October, suppliers may determine the VAT liability by reference to the date the energy is consumed, using meter readings to apportion. That is a helpful concession and it needs the systems capability to apply it — a supplier defaulting to invoice date will get the split wrong in both directions.
Energy-saving materials
The third live relief, and one already in place: a zero rate on the installation of energy-saving materials, running to 31 March 2027, after which it reverts to the 5% reduced rate. It applies in both Great Britain and Northern Ireland.
Qualifying materials include heating and hot water controls, draught stripping, insulation, solar panels, wind and water turbines, ground and air source heat pumps, micro combined heat and power units and wood-fuelled boilers. Added from 1 February 2024: water source heat pumps, batteries for storing converted electricity, smart diverters, and the groundworks or dredging needed to install a ground or water source heat pump. From the same date the relief extended beyond residential accommodation to buildings used solely for a relevant charitable purpose.
One exception that survives unchanged: grant-funded installations of heating equipment stay at the 5% reduced rate.
The hospitality cut people still ask about
For completeness, because it comes up constantly. The temporary hospitality and tourism rate was 5% from 15 July 2020 to 30 September 2021, then 12.5% from 1 October 2021 to 31 March 2022, and reverted to 20% on 1 April 2022. It has not returned, and the June to September 2026 relief described above was narrower — children's meals and attractions, not hospitality generally.
What to do about it
If you supply domestic electricity in Great Britain, the October change is a systems and billing project with a fortnight to run, and the consumption-date basis is the part worth getting right rather than retrofitting.
If you sell energy-saving materials or install heat pumps, the 31 March 2027 reversion to 5% is a pricing and contracting question now — quotes spanning that date need to say which rate they assume.
And if you operated the summer relief, check the boundary cases before the return goes in: separately supplied goods, sports admissions, and season tickets are the three places it was misapplied. Our guides to VAT error correction and what makes a supply taxable cover the corrections if something needs unwinding.
Acumon handles VAT liability, rate changes and the returns through VAT compliance and VAT planning work, with a VAT health check where a rate change has touched a lot of transactions. If you billed across 1 September or will bill across 1 October, the apportionment is the thing to check first.