Over the summer of 2026, a reduced rate of VAT will apply to certain family-oriented leisure activities, including children’s meals at restaurants, theatre and cinema tickets, and admission to some attractions.

In this article, we explore which supplies will be eligible and how the reduction may work in practice. 

What is the reduced rate?

The rate of VAT on eligible activities will be reduced from 20% to 5%. This reduced rate will apply to sales for the admission or purchase of eligible supplies from 25 June to 1 September 2026. 

How will the reduced rate apply in practice?

The 5% rate of VAT will be applied to the qualifying supplies and activities, and businesses can decide if they want to pass that cost saving on to customers, encouraging families to have days out during the summer, or not to reduce their prices and keep the cost savings in their business. The government’s aim appears to be to help families through reduced prices. 

The reduced rate will be applied differently depending on the specific service that the business provides. Certain businesses, notably those whose business extends beyond family-friendly activities, will only be able to apply the lower rate on products/services aimed at children or families. 

Which supplies are only eligible for the 5% rate for children?

Children’s meals

Only children’s meals at restaurants are eligible, and provided that the meals are:

• Served from a dedicated children’s menu; and
• Marketed, presented and priced as children’s meals. 

The reduced rate does not apply to the following:

• Discounted versions of adult meals.
• Shared meals intended for both adults and children.
• Takeaway meals.

Theatre, cinema and exhibitions

Only children’s and family tickets will be eligible for the reduced rate at the following venues and events:

• Cinema screenings.
• Theatrical performances, shows and concerts.
• Exhibitions.

Family tickets must require one or more children in order for the reduced VAT rate to apply, as opposed to more general group ticket sales. 

Which supplies will benefit from the 5% rate for all ages?

The following venues will benefit from the reduced rate on admission for all people, regardless of age or type of ticket:

• 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.
• Observation attractions, including viewing platforms, towers and observation wheels.

What about sales made before 25 June?

The 5% rate of VAT applies to sales where admission is for a date between 25 June and 1 September 2026, including if sales were made before 25 June. 

Key actions for retail businesses

• Review eligibility now: Assess which of your supplies qualify for the reduced rate and under what conditions.
• Decide on pricing: Determine whether you will pass the saving on to customers or retain it, and update pricing accordingly.
• Update your systems: Ensure point-of-sale, billing and accounting systems are configured to apply the correct rate before 25 June.
• Check advance sales: Review any bookings or ticket sales already made for the qualifying period and apply the relief where applicable.
• Separate qualifying and non-qualifying supplies: Establish clear processes to apply the right rate to each supply, particularly if you offer a mixed range.
• Maintain records: Keep documentation to support the rates applied and protect against any future HMRC scrutiny.

Our tax legal team can support with eligibility assessments, systems reviews, transitional issues around advance sales, and HMRC engagement - please get in touch to discuss your position ahead of 25 June.