Where to stay in London

Book London hotels

A London hotel bill is unusually simple on its face. There is no city occupancy tax, no state sales tax, no per-room nightly fee and, today, no tourist levy. There is VAT, and that is the whole of it.

What complicates it is everything the hotel attaches to the room. A service charge, a booking fee, a forfeited deposit and a no-show night are all taxed the way the room is taxed, and a stay of more than four weeks is taxed differently from a short one. Meanwhile the rule governing how the price must be shown to you changed on 6 April 2025, and the levy that does not yet exist was handed to mayors in September 2026.

As everywhere on this site there are no room rates here. What follows is the published material: the rates, the statutory rules, the dates they took effect and the timetabled journey times.

The tax stack is one line, and it is 20%

Accommodation in the UK is standard-rated. The temporary reduced rate that ran through the pandemic ended on 31 March 2022, and HMRC’s VAT Notice 709/3 is blunt about what replaced it: “From 1 April 2022 the normal VAT rules apply, and VAT should be charged at the standard rate.” The standard rate is 20%, against a 5% reduced rate and a 0% zero rate that a hotel room does not touch.

That single rate is the entire public-sector stack. What varies is how much of the bill it lands on:

• Service charge — standard-rated. HMRC: “Any service charge you make is standard-rated.” A genuinely voluntary tip is outside the scope of VAT; anything compulsory is taxed at the same rate as the room, which is what a mandatory resort or destination fee would be in UK terms.
• Booking fee — standard-rated. A separately itemised booking fee is “treated in the same way as a deposit”, and an agent must account for the VAT whether or not the booking is taken up.
• The night you did not use — still standard-rated. A prepayment cannot be recast afterwards as an out-of-scope cancellation charge: “Payment taken in advance for a hotel room cannot be reclassified later as a cancellation charge that is outside the scope of VAT, if the customer does not take up the room.” A forfeited deposit carries VAT.

One exception produces a bill with no VAT on it at all. A business only has to register once taxable turnover over the last 12 months passes £90,000, so a genuinely small guesthouse may be below the threshold. That is a fact about the seller, not a discount: the price is the price, it simply has no tax line inside it.

Stay past four weeks and the arithmetic changes. Under the reduced value rule, “if a guest stays in your establishment for a continuous period of more than 28 days, then from the 29th day of the stay you should charge VAT only on that part of the payment that is not for accommodation” — but the hotel must still treat at least 20% of the remainder as taxable facilities. From day 29 the accommodation element is effectively taxed at about 4%, not at nothing, and the first 28 nights are unaffected.

London has no tourist levy, and the one it may get is a percentage

Nothing on a London hotel bill corresponds to a taxe de séjour, a Kurtaxe or a city occupancy tax. That is a real difference from most European capitals, and it has an expiry date on it.

On 10 September 2026 the government announced that “Mayors and local leaders will be handed the power to introduce an Overnight Visitor Levy – a fee on overnight stays.” The design published alongside it matters more than the announcement, because four decisions were taken that shape what a London levy could look like:

• It is a percentage, not a flat fee. “The levy will be set as a percentage of the accommodation cost, ensuring that charges are proportionate to the price of the stay. Non-accommodation costs, such as meals, should be excluded.” How that works on an inclusive package or a third-party sale is still being worked through.
• There is no ceiling. “The government does not intend to set a cap on the visitor levy rate, however, this is a finely balanced issue and government will continue to consider the case for doing so.”
• There is no minimum notice period. The consultation proposed one and the government “decided not to proceed with the proposal to prescribe a minimum national notice period”, leaving the lead time to each strategic authority.
• There is no cap on nights. Local leaders will not be allowed to limit the number of nights a levy is charged for, on the grounds that it would be operationally and administratively burdensome.

It will apply to all short-term visitor accommodation subject to national and discretionary local exemptions, with accommodation not provided on a commercial basis — registered gypsy and traveller sites, temporary accommodation, charitable shelter or refuge — out of scope. The consultation ran from 26 November 2025 to 18 February 2026 and drew 1,223 responses, of which 60% (726) opposed the percentage model the government then adopted. Legislation is still pending; subject to Parliamentary approval, local leaders are expected to set out spending plans by March 2028.

For a sense of scale, Scotland got there first: the Visitor Levy (Scotland) Act came into force on 20 September 2024 and the City of Edinburgh Council published plans for “a 5% levy on overnight stays”. Nothing obliges a London mayor to pick that number, and nothing stops one picking a higher one.

Since 6 April 2025 the first price you see has to be the whole price

This is the most useful recent change for anyone booking a UK stay. Section 230(4) of the Digital Markets, Competition and Consumers Act 2024 defines the total price in an invitation to purchase so that it “includes any fees, taxes, charges or other payments that the consumer will necessarily incur if the consumer purchases the product”. Where part of the price genuinely cannot be worked out in advance, the trader must explain how it will be calculated, and that explanation must be given “as much prominence as” the total price information. Those provisions, with Part 3, most of Chapter 1 of Part 4 and Schedules 15 to 21, 29 and 30, came into force on 6 April 2025.

Schedule 20 lists 32 practices unfair in all circumstances, and two are worth knowing by number. Paragraph 23 bans describing anything as “gratis”, “free”, “without charge” or similar if the consumer must pay anything beyond the unavoidable cost of responding and of collection or delivery — which is what a free breakfast tied to a mandatory facilities charge is. Paragraph 13 bans “Submitting, or commissioning another person to submit or write—(a) a fake consumer review, or (b) a consumer review that conceals the fact it has been incentivised.”

The enforcement is not theoretical. On an order for a consumer infringement a court may impose a penalty of “a fixed amount not exceeding £300,000 or, if higher, 10% of the total value of the turnover”. The CMA published its price transparency guidance (CMA209) on 18 November 2025, updated 7 January 2026, covering what to include in pricing information “including mandatory fees, taxes and charges”, and on the same day opened investigations into 8 businesses across secondary ticketing, driving instruction, fitness and homeware, reaching no conclusions at that stage.

The first hard number came on 23 June 2026, in ticketing rather than hotels but on exactly the template that applies to a room: the CMA fined StubHub UK £889,200 and ordered refunds of more than £590,000 to 51,350 customers, “around £10.33 per transaction”, for adding mandatory fees only at the final checkout stage between 6 April and 7 December 2025.

Hotel booking sites were in this territory before the Act. Six of them — Agoda, Booking.com, Expedia, ebookers, Hotels.com and trivago — signed CMA undertakings on 6 February 2019 covering hidden charges “such as taxes or booking fees”, with compliance required by 1 September 2019, and a further 25 sites signed sector-wide principles that September. If a mandatory fee still surfaces at the last screen, that is now a statutory problem, not a quirk of the platform. More on what the intermediaries are actually doing on how booking works.

Card fees are banned, service charges are not a tip

A card surcharge is unlawful. Regulation 6A of the Consumer Rights (Payment Surcharges) Regulations 2012 provides that “A payee must not charge a payer any fee in respect of payment by means of—(a) a payment instrument which—(i) is a card-based payment instrument”, and the prohibition has applied since 13 January 2018. A line on a London hotel folio for the privilege of paying by card should not be there.

A service charge is a different animal, and the rules around it changed recently in the guest’s favour without changing the amount. Section 2 of the Employment (Allocation of Tips) Act 2023 inserted section 27D into the Employment Rights Act 1996, requiring that the total of qualifying tips, gratuities and service charges attributable to a place of business be “allocated fairly between workers of the employer at that place of business”. Section 27G sets the deadline: “no later than the end of the month following the month in which the tip, gratuity or service charge was paid by the customer”. The statutory Code of Practice was published on 29 July 2024 and came into force on 1 October 2024.

Two practical consequences. An added service charge on a room-service or hotel-restaurant bill now has to reach the staff at that hotel, which is the argument for leaving it on rather than paying cash instead. And because any compulsory charge is standard-rated, a mandatory service charge or facilities fee carries 20% VAT where a voluntary tip carries none — so the difference between compulsory and optional is worth a fifth of the amount.

Neighbourhoods, measured in interchanges rather than distance

Distance from Trafalgar Square tells you almost nothing. What decides whether a London address works is how many services you can board without changing station, and TfL publishes the line and operator list for each of them. Four that consistently earn their keep:

• Farringdon reaches two airports without a change of station: the Elizabeth line to Heathrow and Thameslink to Gatwick and Luton, on top of the Circle, Hammersmith & City and Metropolitan lines. TfL Journey Planner puts Heathrow Terminals 2 and 3 at 36 minutes and Gatwick at 40 minutes, both direct.
• Paddington carries two separate Heathrow services from one station — the Elizabeth line, 27 minutes from Terminals 2 and 3, and Heathrow Express, which the operator times at 15 minutes every fifteen minutes with six more to Terminal 5 — plus Great Western Railway and the Bakerloo, Circle, District and Hammersmith & City lines.
• King’s Cross St Pancras puts six Underground lines (Circle, Hammersmith & City, Metropolitan, Northern, Piccadilly, Victoria) and eight National Rail operators at one interchange, which is the case for staying there if the trip involves the rest of the country as well as the city. See the London trains page for which operator goes where.
• Stratford is seven rail services in one place: the Elizabeth, Central and Jubilee lines, the DLR, the Mildmay Overground line, c2c and Greater Anglia. Liverpool Street is 8 minutes away on the Elizabeth line.

Victoria is the Gatwick address and only that. Gatwick Express runs non-stop “twice an hour, it takes just 30 minutes” by the airport’s own reckoning and 32 on TfL Journey Planner, and the station adds the Circle, District and Victoria lines with Southern, Southeastern and Thameslink. It has no Elizabeth line, which makes it a weak Heathrow base.

Counting lines is not the same as counting useful ones. Baker Street has five Underground lines and neither National Rail nor the Elizabeth line. Oxford Circus has three and no rail at all. Tottenham Court Road has only two Underground lines, Central and Northern, but adds the Elizabeth line, which makes it the better airport address of the three. Waterloo has four Underground lines plus South Western Railway, and nothing that reaches an airport directly.

Two corrections to the obvious. A Liverpool Street hotel is 39 minutes from Heathrow Terminals 2 and 3 — 12 minutes further than Paddington, with no change of train either way — and 51 to 54 minutes from Stansted including a five-minute walk at the airport end. And the terminal matters as much as the address: Bond Street is 35 minutes from Terminal 5 but 37 from Terminal 4. For a Piccadilly line address, Heathrow’s own guidance offers two open bounds rather than a fixed penalty: Elizabeth line journeys to central London “take under 40 minutes”, Piccadilly line journeys from all terminals under an hour. Compare the two on the London flights page before assuming the Tube is the slow option.

Overnight, the map shrinks to six lines. Rail service in the small hours runs on the Central, Jubilee, Northern, Piccadilly and Victoria lines plus the Windrush line on the Overground. A hotel off those six has no rail option after the last train, whatever it has in daylight.

Two costs attach to the address rather than to the room. Tube and rail fares rose on 1 March 2026 by RPI plus one per cent, though “no single pay as you go Tube fare within Zones 1-6 will increase by more than 20p”, and Travelcard prices — and with them the daily and weekly caps — are frozen until March 2027. The exception is the airport run: the Elizabeth line fare between Zone 1 and Heathrow went from £13.90 to £15.50. And an apartment is not the easy substitute it is elsewhere. Under section 44 of the Deregulation Act 2015, short-term letting of residential premises in Greater London is capped at 90 nights in a calendar year before it becomes a material change of use, and the provider must be liable for council tax on the premises.

What a London booking does and does not entitle you to

There is no 14-day cooling-off period on a hotel booking. The Consumer Contracts (Information, Cancellation and Additional Charges) Regulations 2013 exclude from the distance-contract cancellation right “the supply of accommodation, transport of goods, vehicle rental services, catering or services related to leisure activities, if the contract provides for a specific date or period of performance”. Whatever free-cancellation window the hotel or the platform offers is a commercial choice, not a statutory right, and the forfeited deposit still carries VAT.

A package is governed differently. Under the Package Travel and Linked Travel Arrangements Regulations 2018 the price may only rise as a direct consequence of three things — fuel or other power costs, taxes or fees imposed on the travel services by third parties, or the relevant exchange rates — and the organiser must notify the traveller with a justification and the calculation, on a durable medium, “at the latest 20 days before the start of the package”. If the increase exceeds 8% of the total price, the traveller may terminate without a fee and the organiser must refund everything “not later than 14 days after the contract is terminated”.

More generally, the Provision of Services Regulations 2009 have long required a provider to make the price available in advance where it is pre-determined, and otherwise to supply on request “the method for calculating the price so that it can be checked by the recipient, or a sufficiently detailed estimate”. The DMCC Act raised that floor; it did not invent it.

Two older rules still operate at the desk. Section 2 of the Hotel Proprietors Act 1956 caps the hotel’s liability for a guest’s lost or stolen property at “fifty pounds in respect of any one article, or one hundred pounds in the aggregate”, and only where the statutory notice is displayed conspicuously at or near reception, or the main entrance if there is no reception. The cap does not apply to property expressly deposited for safe custody, which is a reason to hand something over at the desk rather than leave it in the wardrobe safe. And under articles 4 and 5 of the Immigration (Hotel Records) Order 1972, every guest aged 16 or over must give their full name and nationality on arrival; guests the Order classes as aliens must also give a passport or other identity document number and place of issue on arrival, and a next destination before departure. The record is kept for at least 12 months and is open to police inspection.

Common questions

How much tax is added to a London hotel room?

VAT at the standard rate of 20%, and nothing else. There is no city occupancy tax, no per-room nightly charge and no tourist levy in London. The 20% applies to the room and to any compulsory extra on the same bill, including a mandatory service charge or facilities fee and a separately itemised booking fee. A very small guesthouse below the 90,000 pound VAT registration threshold may charge no VAT at all.

Does London charge a tourist tax?

Not today. On 10 September 2026 the government announced that mayors and local leaders in England will be given the power to introduce an Overnight Visitor Levy, set as a percentage of the accommodation cost rather than a flat fee, with non-accommodation costs such as meals excluded. There is no national cap on the rate, no minimum notice period before one starts and no cap on the number of nights charged. Legislation is pending; spending plans are expected by March 2028. For comparison, Edinburgh published plans for a 5% levy.

Does the price I am shown have to include every fee?

Yes, for anything you necessarily have to pay. Since 6 April 2025, section 230 of the Digital Markets, Competition and Consumers Act 2024 requires the total price in an invitation to purchase to include any fees, taxes, charges or other payments the consumer will necessarily incur. Where a component genuinely cannot be calculated in advance, the method must be explained with as much prominence as the total. Penalties run to 300,000 pounds or 10% of turnover, whichever is higher, and in June 2026 the CMA fined StubHub UK 889,200 pounds and ordered more than 590,000 pounds in refunds for adding mandatory fees only at checkout.

Does a stay of more than 28 nights cut the VAT?

It reduces it, but not to zero. From the 29th day of a continuous stay the hotel charges VAT only on the part of the payment that is not for accommodation, while still treating at least 20% of the remainder as taxable facilities. That works out at an effective rate of roughly 4% on the accommodation element from day 29 onwards. The first 28 nights are charged at the full standard rate, and the stay has to be continuous.

Can a hotel charge me extra for paying by card?

No. Regulation 6A of the Consumer Rights (Payment Surcharges) Regulations 2012 prohibits a payee from charging a consumer any fee for paying by a card-based payment instrument, and has done since 13 January 2018. A service charge is a separate matter: it is lawful, it is standard-rated for VAT if compulsory, and under the Employment (Allocation of Tips) Act 2023 it must be allocated fairly to the workers at that place of business by the end of the month following the month you paid it.

Which London areas put a hotel closest to the airports?

Farringdon is the only common hotel district that reaches two airports without changing station, at 36 minutes from Heathrow Terminals 2 and 3 on the Elizabeth line and 40 minutes from Gatwick on Thameslink. Paddington is 27 minutes from Heathrow on the Elizabeth line and has Heathrow Express as well. Victoria is the Gatwick address, about 30 to 32 minutes on Gatwick Express, but has no Elizabeth line. Liverpool Street is 39 minutes from Heathrow and 51 to 54 minutes from Stansted.

Sources

Fares, journey times and operating rules on this page were checked against these sources on 11 September 2026. Authorities change fares and timetables without notice — confirm anything time-critical on the operator’s own site.

• HMRC - Hotels and holiday accommodation, VAT Notice 709/3
• GOV.UK - VAT rates, standard rate 20 per cent
• Digital Markets, Competition and Consumers Act 2024, section 230, total price
• DMCC Act 2024 (Commencement No. 2) Regulations 2025, SI 2025/272
• CMA - CMA orders StubHub UK to refund customers over hidden fees
• MHCLG - Visitor Levy in England, government response
• GOV.UK MHCLG - Local leaders handed powers to drive investment in communities
• TfL Newsroom - changes to Tube and rail fares from 1 March 2026
• TfL Unified API (JSON data) - StopPoint HUBZFD, the lines and operators serving Farringdon