Readers’ forum: Out of key?

One of our hotel clients is concerned that they have been dealing with VAT incorrectly on conference room hire charges after reading about the recent tribunal case Europcar Group UK Ltd (TC7733) which concerned children’s car seats being an optional extra when hiring a car and therefore subject to a separate VAT charge.

The hotel has a very nice grand piano and some hirers have a musical interest and need to use the piano. My client therefore advertises two room rates for hirers: £45 an hour without piano or £60 an hour with piano. The client has always treated both prices as exempt from VAT – there is no option to tax in place on the property. In other words the supply is still for room hire but with a piece of extra furniture (the piano) needed in some cases. To add a twist if a hirer...