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Have you ever wondered when ordering your printed stationery, what the VAT Rules are?
The UK government’s rules for VAT on printed matter are complicated – particularly in relation to VAT on ‘Leaflets’ and ‘Flyers’ but read on as I am going to try and explain as simply as possible.
Whether you pay VAT on a printed item depends on many factors including its format, size, content and intended use. Most printing is classed by HM Customs and Revenue as standard rated (in other words, you must pay VAT at the current standard rate). This includes stationery items such as Letterheads, Compliment slips, Business cards, Postcards, Folders, invitations, Tickets and Greetings Cards.
However, there are exceptions:- Most books, booklets, brochures, pamphlets and leaflets are ZERO VAT rated (you do not pay VAT).
BUT: If your printed document includes an area intended to be written on (such as a form or a section to be completed and returned) it MAY be classed as VAT standard rated; If your document can be used to gain entry to an event or premises (e.g. “free entry with this leaflet”) then it WILL be classed as VAT standard rated as it will be regarded as a ticket; If your document can be used to gain a discount on goods or services (e.g. “10% off with this leaflet”) then once again you WILL have to pay VAT as it will be regarded as a voucher.
HM Customs and Revenue state that to qualify for VAT zero rating, a leaflet must be of a ‘ephemeral nature’ (!). What that means in plain English is that the leaflet must be designed to be read a few times and then thrown away. Therefore ‘Leaflets and Flyers’ which are intended to be displayed in shop windows would be classed as posters and would be subject to VAT at standard rate. If the leaflets main function means that it should be kept or used for a specific purpose in its own right it would NOT be classed as a leaflet. If the leaflet is laminated or encapsulated, HM Customs and Revenue consider this to mean that it is intended to be kept by the recipient and is therefore VAT standard rated. They also consider the use of thick paper or card as another indicator that a leaflet may be designed to be retained and could therefore class it as VAT standard rated, depending upon the content.
A warning… for ease, some printing companies charge VAT on everything. However, at Kestrel Printing Limited we look very hard at each product when producing our invoices to see if VAT needs to be added or not.
Visit our e-commerce website, as when you purchase your products on-line the VAT is automatically worked out for you.