Isle of Man to Mirror UK VAT Changes
The UK Government announced that a reduction in the rate of VAT applied to hospitality, accommodation and attractions will now be extended until 31 March 2021.
The reduction from 20% to 5% was originally planned to run for six months from 15 July 2020 until 12 January 2021.
The Isle of Man will also extend the application of the 5% rate to hospitality and attractions until 31 March 2021. The reduced rate of VAT already applies to holiday accommodation in the Isle of Man.
The UK Government also announced an option on how to pay deferred VAT due for payment next spring. The Isle of Man will replicate this measure with more details available in due course.
Businesses that have deferred paying VAT from the period March to June 2020 were due to pay the outstanding amount by 31 March 2021. They will now be able to opt to pay in smaller instalments during 2021-2022 without incurring interest.