How does the Hospitality “Eat Out to Help Out” Scheme Work?

The Chancellor announced several measures to support people and businesses in his Mini-Budget on 8 July. Here I’ll focus on the Eat Out to Help Out Scheme.

Also check our my previous blog on the VAT Rate cut to 5% for Food, Accommodation and Attractions.

Eat Out to Help Out Scheme

  • Any hospitality business will be able to sign up to the scheme with the Government from Monday 13 July 2020
  • The scheme allows them to provide 50% discounts to guests, up to £10 per head, including children

When does it apply?

  • All day, every Monday, Tuesday, and Wednesday
  • 3 August 2020 to 31 August 2020

Who can join the Eat Out to Help Out Scheme?

  • Any establishment providing eat in food
  • With dedicated seating area, or shared seating area with another establishment
  • You were actively trading on 7 July 2020

Who can’t join the scheme?

  • Establishments providing a take-away service only
  • Hotels providing room service only
  • Establishments providing private catering

What does the 50% discount apply to?

  • All day every day service
  • Hot and cold food – eat in only
  • Non-alcoholic drinks
  • Not alcoholic drinks
  • Not service charges and tips
  • Includes all guests, including children

*The discount does not apply to take-away food and drink, but some of this may still be covered by the VAT rate cut to 5%

Also have a read of our blog on VAT on take-away food

What are the important dates?

  • 13 July 2020: register for the scheme. Here is the Government site with info and to register
  • 3 August 2020: start offering discounts (only if you’re already registered)
  • 31 August 2020: scheme closes
  • 30 September 2020: last date to make a claim

How do you register?

You can register from Monday 13 July 2020

Register with HMRC here

You’ll need your business info including:

  • Government gateway logins
  • Name and address of each establishment you’re registering
  • Bank details you want the scheme funding to go into
  • Address the bank account is associated to
  • VAT number
  • Employer PAYE number
  • Corporation tax or self-assessment number

*we have all this info if you’re our client

How does it work?

We’re expecting more detail when the scheme goes live but here’s what we know:

  • Each establishment has to record daily details of 50% discounts given to customers, including:
    • number of people using the scheme with you
    • total value of sales using the scheme
    • total amount of discounts given per day
  • the Government will refund these discounts to you when you claim
  • We think it’s essential to have an electronic point of sale that will record this information at the point of sale, otherwise it is going to cause you a lot of work and headaches!
  • You should be able to set up a discount on your EPOS that you can use with ordering and sales
  • Check out our iZettle vs Square blog to see the benefits of EPOS systems

How do you claim the discounts back?

  • You will claim the amounts discounted from your customers back from the Government
  • Wait 7 days from registering to make your first claim from the Government
  • When you register you’ll be given a reference. You’ll need this to make your claims
  • Claim every 7 days
  • Funds should be in your account within 5 working days

What about the VAT rate cut to 5%

  • This works alongside the VAT rate cut, so you’ll also need to update your sales systems with this update
  • More on our VAT rate cut blog

What next?

  • Get up to speed as quickly as you can with these changes and the VAT rate cut changes
  • Register as soon as possible on 13 July 2020
  • Make sure your systems can cope
  • Now is the time to get an EPOS system set up, it will save you so much time and stress!
  • Get in touch if we can help with any of this
  • And remember to breathe and take things one step at a time (How do you eat an elephant? One bite at a time!)

We’re here for you

Check out our new COVID19 Resource page for loads of info.
Join our private Facebook page for Small Business Owners.
Book in a 30 minute zoom call with me.

Stay safe. Stay strong.

Sharon x