The rules and regulations on VAT on printed items is a minefield, even after working within the print industry for over 10 years now I still have to refer to the HMRC website from time to time.
A client of mine only last week said that she isn’t bothered about vat as she isn’t vat registered when in reality she is exactly the person who should be concerned about vat. Depending on what she purchases she could find an additional 17 ½ % charged on top of what she was originally quoted.
She asked me why printers couldn’t quote all prices with VAT and I can see where she is coming from. It would benefit the smaller non vat registered business to know whether the item is vatable or not before they purchase and it is definitely something I will be looking at in the very near future.
Anyhow back to the regulations – I don’t want to bore you with this as I am quite aware after spending a lovely couple of hours last week refreshing my memory on the minutiae of VAT rulings in the UK how sleep inducing it is so we will just look at the most commonly printed products.
The rules and regulations regarding VAT on print are dependant on what the item is, what it is to be used for and what it is printed on.
Most print items as classified by the HMRC are standard rated (which means you are liable to pay standard rate VAT, currently 17½%) and where it gets us business owners is on our stationery e.g business cards, letterheads, compliment slips, posters, postcards and envelopes.
However there are exceptions to the rules and they are for the following:
Restricted to goods produced on paper and similar materials such as card and are usually bound with a cover. Goods containing text in other formats such as audio or video cassettes or CD Rom are classed as standard-rated.
Brochures and pamphlets
Brochures usually consist of several sheets of reading matter fastened or folded together, but are not necessarily bound in covers. They usually contain advertising material in the form of text or illustrations.
Pamphlets are similar, but are usually comprised of material of a political, social or intellectual nature.
Leaflets
Leaflets normally consist of a single sheet of paper not greater than A4 in size. They must be intended to be held in the hand for reading, convey information and must be supplied in a minimum quantity of 50 to permit general distribution. They must be printed on limp paper and designed to be read a few times and then thrown away. Items printed on stiff paper and card are not automatically excluded, however the use of stiff card indicates that the item is to be kept and would then be excluded from the leaflet classification.
If an item has an area to be completed, as long as that area is under 25% of the total area then it may still be classed as Zero rated.
Whatever the area for completion, a publication which is designed to be returned whole after completion is always standard-rated.
Here are some more items not covered above and their VAT liability:
Zero-rated Albums Standard-rated Annuals Zero-rated Appointment cards Standard-rated Articles of association (complete in booklet form) Zero-rated Badges Standard-rated Bags, paper Standard-rated Calendars Standard-rated Catalogues Zero-rated Certificates Standard-rated Circulars Zero-rated Colouring books (children’s) Zero-rated Comics Zero-rated Company accounts and reports Zero-rated Delivery notes Standard-rated Folders Standard-rated Zero-rated Instruction manuals Zero-rated Invoices Standard-rated Labels Standard-rated Magazines Zero-rated Mail order catalogues Zero-rated Manuals Zero-rated Membership cards Standard-rated Memo pads Standard-rated Menu cards Standard-rated Music Zero-rated Newspapers Zero-rated Note books, pads and paper Standard-rated Order books and forms Standard-rated Orders of Service Zero-rated Painting books (children’s) Zero-rated Picture books Zero-rated Price lists (fully printed leaflets or brochures) Zero-rated Printed pictures Standard-rated Programmes Zero-rated Rag books (children’s) Zero-rated Receipt books and forms Standard-rated Reply-paid coupons and envelopes Standard-rated Sports programmes Zero-rated Stickers Standard-rated Tickets Standard-rated Time cards and sheets Standard-rated Timetables (in book or leaflet form) Zero-rated Trade catalogues Zero-rated Trade directories Zero-rated Travel brochures Zero-rated Vouchers Standard-rated Wall charts Standard-rated
Please note the above is not all encompassing and for more information go to the HMRC website www.hmrc.gov.uk/vat
