4 May 2020

In his Budget in March, Chancellor Rishi Sunak announced that there would be a zero VAT rate on certain supplies of e-publications with effect from 1 December 2020. This was aimed to support literacy and reading in all its forms.

However, following the outbreak of the coronavirus (COVID-19) pandemic and the need for people to stay at home, on 30 April the Government announced it was bringing forward the implementation date to 1 May 2020.

This is intended to reduce the cost of access to online publications during these challenging times when many people are confined to their homes and schools are closed.

E-publications which qualify

With effect from 1 May 2020, electronic supplies of the products listed below, unless they are wholly or predominantly devoted to advertising, audio or video content will be zero rated:

• books
• booklets
• brochures
• pamphlets
• leaflets
• newspapers
• journals and periodicals (which include magazines)
• children’s picture and painting books

E-publications which do not qualify

Advertising content – If more than half of an e-publication is devoted to advertising, audio or video content, its supply will be standard rated for VAT purposes – for example a digital sales brochure.

Audiobooks – The extension only applies to the supply of electronic versions of books already zero-rated in UK law. The zero-rating is limited to electronic versions of books that can be read or looked at. Supplies of audiobooks remain taxable at the standard rate whether supplied in a physical or digital format.

Intellectural property – Supplies of intellectual property, even if they are supplied electronically, are not supplies of e-publications and are always standard rated.Electronically supplied plans or drawings for industrial, architectural, engineering, commercial or similar purposes are specifically excluded in the legislation.

For more information and guidance

The Government has published more guidance here  or contact one of VAT specialists for more information and guidance on how this affects your organisation.  Contact them via vat@shipleys.com 

Specific advice should be obtained before taking action, or refraining from taking action, in relation to this summary, if you would like advice or further information, please speak to your usual Shipleys contact.

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