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HMRC internal manual

VAT Transport

HM Revenue & Customs
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Zero-rating of passenger transport: Railway and other trips

The liability of railway and other trips provided with facilities such as catering or entertainment should be determined using the principles applied to cruises in VTRANS021300. The following types of train journey commonly supplied by historical railway groups are accepted as zero-rated:

  • Santa specials (include mince pies, drink, present from Santa);
  • winter warmers (include a bowl of soup); and
  • Hogmanay specials (include a whisky or other alcoholic drink).

Where “Dine on the line” or “Steam and cuisine” trips are single supplies according to the criteria in VTRANS021300, it is likely that the rail journey will be incidental to the provision of a full meal and therefore standard rated. This is especially so where the train is stationary for a significant part of the meal, for example because the track is not long enough for the train to continue on its course throughout the duration of the meal. Cases where steam railway operators are claiming single zero-rated supplies but where passenger transport is transparently not the largest single element, should be referred to Supply Policy Team.

See VTRANS030000 for the treatment of railway premises as places of entertainment or interest for the purposes of exclusion from zero-rating of supplies under Legal Note 4A to Group 8.