VAT and holidays

[anna_whd]

Hi there - a friend of mine works for a hotel chain and she tells me that if you booked a room before 1st Dec, for a stay after that, they will refund the vat. They are not advertising this but will do it if you contact them.
We booked a holiday last month for a trip in Autumn next year. We have only paid a deposit. Do you think if I contact Thomas Cook they will refund the VAT on my future bill (due July)?

[Hawkwalk]

where are you travelling to? If going abroad then there will not be any VAT on your hotel as the vat reduction was for the UK only. There is also no VAT on flights so the only saving will be on admin costs from Thomas Cook which is a very small percentage of the cost so wont save you much worth worrying about.

Call and ask them

[Skyline D]

As hawkwalk says, there's very little VAT on a package deal through a travel agent anyway but, there would be no refund due anyway since the VAT would be on Thomas Cook's admin fee and that would have been charged at the correct VAT rate at the time. The tax point was the time of the service being provided, not the date you go on holiday.

As for hotel chains refunding VAT on rooms domestically, that will depend on what their deposit policy is. If the deposits are non-refundable then the tax point is the point at which the room was booked and therefore the correct VAT was charged and no refund applies. The hotel would have paid the VAT to the HMRC at 17.5%. If on the other hand deposits are not taken or are refundable then the tax point is the date of supply (when you check in) and, theoretically, VAT would be repayble. We're talking �2.50 in every �117.50 room charge though. In all but the most expensive of hotels it's going to be fairly trivial too. Not worth losing sleep over.

[anna_whd]

Thank you both - was worth a try!