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Big cuts in tax bills likely for outbound tour operators
Outbound tour operators are likely to see a big cut in their VAT bills from next year when the UK’s transition agreement with the European Union comes to an end.
In changes already agreed in principle with HMCR, the vast majority of companies selling overseas travel will no longer have to pay VAT on TOMS from 1 January, said accountancy firm Elman Wall’s head of VAT Laura Chipp.
However, she warned HMRC has not yet signed off on the changes.
VAT will still apply for UK travel services and there is some concern said Laura that European tour operators will undercut domestic suppliers since they will become exempt from VAT.
She also warned that there is a risk that tour operators will have to register for VAT in the European countries where they operate, although she said if this happens it might not be for some time.
Read Laura’s full explanation here.
Linsey McNeill
Editor Linsey McNeill has been writing about travel for more than three decades. Bylines include The Times, Telegraph, Observer, Guardian and Which? plus the South China Morning Post. She also shares insider tips on thetraveljournalist.co.uk
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