🚨 Two important HMRC changes announced this week — here’s what you need to know.

Chancellor Rachel Reeves made two significant announcements on 21 May 2026 that affect employers, employees, the self-employed, and businesses in hospitality and leisure.

🚗 MILEAGE ALLOWANCE — 45p → 55p per mile

The approved mileage rate for cars and vans has increased by 10p, the first rise since 2011. It applies from 6 April 2026 — backdated to the start of the tax year.

What this means:
✅ Employers must update payroll and expenses systems now
✅ Any mileage reimbursed at 45p since 6 April needs topping up
✅ Self-employed? The new rate applies to your simplified expenses
✅ Employees paid below 55p can claim Mileage Allowance Relief via Self Assessment or Form P87

🍽️ SUMMER VAT CUT — 20% → 5% (25 June to 1 September 2026)

As part of the Government’s ‘Great British Summer Savings’ initiative, VAT is being temporarily reduced on:

→ Children’s meals served on-premises in restaurants and cafés
→ Children’s and family cinema, theatre, and exhibition tickets
→ Admissions to theme parks, zoos, soft play, museums, water parks and more

Not in scope: sporting activities, exempt supplies, season tickets permitting entry outside the period, or takeaway meals.

If your business is affected, you need to update VAT codes and till systems before 25 June.

Both changes require action before the end of June. If you’re unsure how they apply to your business or personal tax position, reach out — we’re here to help.

📩 Contact us at 0330 390 5959or email us at sales@lmjgroup.co.uk