Guide · Edinburgh visitor levy
Does the Edinburgh visitor levy count for VAT?
Yes. The levy you collect counts as part of your turnover, so it counts towards the £90,000 VAT registration threshold. If you're VAT registered, the levy is 5% of your price before VAT, and you charge VAT on the levy too.
Is the visitor levy part of the price for VAT?
Yes, on the guidance published so far.
ICAS, the Scottish accountants' body, says the levy is "treated as consideration for the supply of accommodation and therefore forms part of the taxable supply". VisitScotland's national guidance, which the council's guidance points to, says that for VAT-registered providers "the visitor levy is subject to VAT".
I couldn't find any HMRC guidance written specifically about the visitor levy. The council says VAT is a matter for HMRC, and to get your own tax advice if you're in doubt. So if VAT affects you, check with your accountant.
Does the levy count towards the VAT threshold?
Yes. Add the levy to your turnover.
You must register for VAT if your taxable turnover for the last 12 months goes over £90,000, or you expect it to in the next 30 days. The levy you collect counts towards that, even if you're not registered. ICAS warns this may push some businesses that are just under the threshold over it.
For example, if guests pay you £86,000 for accommodation and £4,300 in levy, your turnover is £90,300, which is over the threshold.
How do I work out the levy if I'm VAT registered?
Take 5% of the accommodation price before VAT. Then VAT is due on the levy itself.
This is VisitScotland's own example, for a room at £100 before VAT, with VAT at 20%:
| VAT registered | Not VAT registered | |
|---|---|---|
| Room | £100.00 | £100.00 |
| VAT on the room | £20.00 | £0.00 |
| Levy at 5% | £5.00 | £5.00 |
| VAT on the levy | £1.00 | £0.00 |
| Guest pays | £126.00 | £105.00 |
On your return, report revenue without VAT. Do the same for the 6th night onwards: take off the levy first, then the VAT. If your platform only adds 5% and no VAT on top, ask your accountant how to handle the VAT on the levy.
I'm not VAT registered, but my platform shows VAT
Switch it off in that platform's tax settings.
If you're not registered, ignore VAT completely. Everything the guest paid, apart from the levy, is your revenue, even if a booking shows a "VAT" line.
Could this change?
Possibly, but not soon.
ICAS says the options are changing the Scottish law so visitors are liable for the levy, or exempting it from VAT in UK law. It says the UK Treasury currently has no plans to change UK law.
Doing your return?
My free guide takes you through every step of the return, including what to do if you're VAT registered.
Sources: ICAS, Visitor levy: what accommodation providers need to know (updated 29 September 2026); VisitScotland, Guidance on the Visitor Levy for Local Authorities (August 2026), chapter 10; VisitScotland, Visitor Levy FAQs for Accommodation Providers, section 2.11; GOV.UK, when to register for VAT; City of Edinburgh Council, Visitor Levy Scheme guidance (Version 2.1, September 2026). This is general help, not tax advice.