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Bookkeeping in hospitality: VAT rates and cash records
Written by Ilias5 min read
Hospitality has bookkeeping with its own challenges. You work with different VAT rates for food and drink, you often have cash payments and your stock and purchasing are an important part of your figures. Whether you have your own place, work as a freelance chef or run a food truck, this article explains what you should watch for.
VAT rates in hospitality
In hospitality two rates apply side by side. On food and non-alcoholic drinks you serve on the spot you charge 9 percent VAT. On alcoholic drinks you charge 21 percent. This means you have to split your turnover between these rates. A good cash register system that registers this automatically saves a lot of work and errors.
Purchasing works the same way: you reclaim the VAT on your purchases at the rate the supplier charges. Keep your purchase invoices tidy, because stock and purchasing form a large part of your costs.
Cash records and physical money
In hospitality a lot is still paid in cash. The tax authorities watch this closely. So keep a watertight cash record in which you register your cash receipts daily. The cash book must match your actual cash; a negative cash balance is a sign that something's wrong.
Count your cash daily and record differences. A good link between your cash register, your card receipts and your bookkeeping ensures your figures are correct and you have nothing to explain during an audit.
Staff and stock
If you have staff or work with on-call workers, payroll administration comes into play. That's a separate obligation with payroll taxes and returns. Many hospitality entrepreneurs outsource this because it's error-prone.
Your stock counts towards determining your profit. At the end of the year you do a stock count, so you know what you still have. Perishable products and spoilage also belong in your bookkeeping. That way you get a fair picture of your margin.
This article provides general information based on the rules known for 2026 and does not replace personal tax advice. For your specific situation, we're happy to take a look with you.
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