Restaurants get first taste of eat out to help out scheme

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One of the Chancellor’s flagship Summer Statement announcements was the ‘eat out to help out’ scheme. The scheme was designed to encourage nervous diners back into restaurants, as one of the many measures to support the beleaguered hospitality sector bounce back from the Covid-19 lockdown measures.

Restaurants are now able to sign up to the scheme and offer diners a 50% discount all day every Monday, Tuesday and Wednesday from 3 to 31 August. As the Sunak announced in Parliament, the discount is up to a maximum of £10 per diner, which the restaurant can then claim back from the government.

As the purpose of the scheme is to get patrons back through the door, the scheme does not limit customers on the number of times they can use the meal vouchers throughout August. It should go without saying, but the guidance specifies that customers not eating or drinking cannot get a discount.

Restaurants will have until 31 August to register for the scheme, provided their business sells food for immediate consumption on the premises, is registered as a food business with their local authority and has its own dining area. This means though that takeaways, private catering services, room service in hotels and mobile food vans will not be eligible for the scheme.

Restaurants will have to register using their government gateway ID and provide the name and address of each establishment. That’s unless they are registering more than 25 restaurants as part of the same business, where they only would have to provide a link to a website which lists the trading name and address of the participating restaurants.

The guidance also suggests restaurants come armed with their bank account number, sort code and the date when their business started trading when registering. In addition, the businesses may also need their VAT registration number, PAYE reference number and unique taxpayer reference.

Reaction to the scheme

The Chancellor’s attempt to stimulate the hospitality sector picked up some flak from HMRC’s chief Jim Harra and advisers questioning the effectiveness and value for money of the scheme.

Ben Steele, managing partner of Steele Financial, told AccountingWEB that many of his hospitality clients see Monday to Wednesday as the “quietest days” and “usually do not bother to open because of this”.

On Tuesday’s Any Answers Live, panellist and practice owner Della Hudson echoed Steele’s concerns: “The eating out to support restaurants is only for the first part of the week and it might be that a restaurant is only viable opening over the weekends and a few other nights.”

To add to this, many potential diners may put their health before the 50% vouchers: “A lot of it depends on the public’s confidence in getting out and about in a post-lockdown world. One of the things I really want to do is go out into a decent restaurant. However, if I don’t feel safe there, I’m not sure I want to do it. I’d stay home and cook instead.

“A lot of restaurants have been doing take away, so are they going to switch off their takeaway and move to a dine-in experience? How many people can they serve through the takeaway and how profitable is the dine-in experience?”

Regardless, Hudson recommends for restaurants to register for the vouchers because “it is better to register and not use it”.

https://www.accountingweb.co.uk/tax/hmrc-policy/restaurants-get-first-taste-of-eat-out-to-help-out-scheme