Folksy Ltd

VAT registration if you are selling digital goods


(Minerva) #1

Have you seen this? The new EU VAT regulations coming into force in Jan 2015 mean that micro-businesses supplying digital services (such as Ebooks, music downloads, apps, guides and courses) will forfeit their VAT exemption threshold by doing digital business in Europe.

I think this applies to knitting patterns too?


(Eileens Craft Studio) #2

We all need to read this and sign it

ASAP it could mean we will no longer be able to sell our tutorial, patterns to European customers is we are to pay VAT when we are not earning enough to normally be registered and paying VAT.


(Minerva) #3

From what I gather from others, we should be able to print patterns and send them by mail to EU countries. That means customers will have to pay the shipping and wait a few days for the pattern to arrive. That might put them off.


(Eileens Craft Studio) #4

Yes that would be the way around it so we’d have to charge more as they’ll be printing ie paper, ink and electrical power to take into consideration. pdf is why my customers get their patterns so cheaply.
Also we’ll have to charge for postage. So all round poor costs for us to pass on to our customers.:frowning:


(Shirley Woosey) #5

I’ve already signed this because I supply miniature pdf patterns for dolls house carpets on here and on the Darkside.

Shirley x


(Eileens Craft Studio) #6

I also have signed.


(Brenda Cumming) #7

a friend of mine who sells digital downloads, wrote to UKIP and already they have replied and are on the case and have written a letter to the commissioner. (commissioner for what, I am not sure…lol) but that is a very quick response…watch this space.


(Vivianne Kacal) #8

It looks as though, if you classify patterns as e-books the 3rd party platform/marketplace where you sell your patterns ie. Folksy might have to register and become liable for recording , collection of VAT etc …although no-one really seems to know for sure what’s going on.

This flowchart was given on HMRC Twitter feed: VAT link


(Eileens Craft Studio) #9

I twitted at the 10am #vatmoss as requested


(Lizzie Gillum, Bedfordshire, Uk ) #10

@sianfolksy, Could you let us know Folksy’s position regarding this new VAT Legislation, please? It comes into force in about six weeks’ time, so obviously sellers who supply goods in a digital format, will be anxious to know.
Thank you!


(Shirley Woosey) #11

Took part in the twitterstorm yesterday on behalf of my miniatures shop.

Shirley


(Eileens Craft Studio) #12

As of January I will no longer offer my patterns in pdf form. I will print them myself and post them via royal mail this will mean my pattern prices will increase as of January 1st.


(Eileens Craft Studio) #13

ok fellow digital patterns makers some more news and please don’t forget the Twitter with HMRC on Thursday between 3.30pm to 5.00pm where we can ask all the questions we need to ask of HMRC

http://ysolda.com/blog/2014/11/26/they-didnt-know-the-impact-of-vatmoss-on-really-small-businesses


(Silvapagan) #14

If we all register and dilligently file nil returns 4 times a year, surely that would cost the Government (us tax payers) more in the long run?!


(Eileens Craft Studio) #15

yep that’s one of the things they’ve not even thought about see how rushed and badly thought out this whole debacle is.

No one did any real research at the tax office as to the implications of these new rules.

Think of the time wasted by us as well every month we’d have to fill that nil vat tax return 12 months of the year what a waste of manpower, time and money.


(Sharon Robins) #16

Thanks Eileen for the info. I have just found out about this new law today, so I am somewhat bemused by it all. I hope they figure out how to exemplify small businesses like ours, otherwise it will be a shame to lose such a large amount of creative talent that will just give up and close their shops on the 31st of December.


(Eileens Craft Studio) #17

I’ve decide to continue selling patterns and rather than do so digitally I’ll go back to old school and print mine and post . Of course I’ll have to charge that bit more to cover printer ink, paper and ware and tare on my printer. I’ll also have to charge for postage. It’s a pity it will mean my patterns will cost my customers more :frowning:


(Sharon Robins) #18

I sell both digital and printed patterns, so may have to stick with the printed ones too. I hope they sort something.


(Eileens Craft Studio) #19

Sharon @RaggyRobin I’m going to send you a link via pm as I have some information


(Silvapagan) #20

I’ve decided to re-organise the patterns I’ve designed and offer them in sets of 2 or 3 on a single CD instead which I will post to the buyer. I know fewer and fewer people have PCs now, but I feel that’s a more economical way for me to go as an interim measure.