I have been following various threads concerning this on Etsy.
Folksy does not offer us the chance to do “Instant Downloads” of pdf patterns and other digital products.
Therefore because you have to physically input an email address and manually attach your patterns etc to an email this will NOT count as a digital service. There is MORE than minimal human intervention.
This was confirmed by HMRC in the Twitter Q & A session.
So it will not affect Folksy sellers as I see it.
Shirley x
That sounds great. And reasonable.
Oh that’s good to hear as they last I read it was doubtful as to whether we could get around it that way.
Thanks for the update Shirley 
The only difficulty with emailing patterns is that the pdfs are often bigger than an individual’s mailbox will allow. That’s why I like the other place, even though I’ve had to cull some photos from the patterns I’ve got over there. I was hoping that Folksy would introduce a similar service, but I can see that it might not be a high priority for them.
You could try using Dropbox.com in those circumstances. You can upload a file to a Dropbox, then the recipient can use a special link to access that box and retrieve the file.
It’s free up to a certain amount of space, then you can pay for more space. You could maybe store popular files in their own “box” as a permanent thing, but remove those that are sold only occasionally, to maximise the potential of your free space.
There’s an explanation of how Dropbox works at their homepage.
I just reduce the same of the images so the pattern ends up being a smaller file. So far I’ve not had any problems as I send my patterns via email attachments. But my customers are in the USA, Canada and India.
I’ve only used Dropbox to download notes for some studies I teach one evening a week. I’ve never loaded any thing up to it.
Yes. I think actually reading the legislation might have saved a lot of angst. I’m glad you took the time, Shirley
I’m afraid that HMRC are now contradicting what they have said earlier!
It now seems that merely attaching a pdf file to an email and sending it to a customer is not enough human intervention to stop it being an automatic process.
Read this blog for more up to date info from the HMRC Webinar which took place today.
It seems just as woolly as ever and is all up the air again.
Shirley x
Quote: Example 5: Selling patterns through an online store, but the actual PDF pattern is manually emailed.
Answer: Difficult borderline. If it is effectively someone sends through a request and all you do is send it to them then there is minimal human intervention and it is then an e-service and is VAT-MOSS liable. If you need to make a bespoke pattern or communication, then it’s not VAT-MOSS.
It would appear so Shirley which is the information I first read, then they seemed to suggest the opposite and now we are back to it again. I do wish they’d just make up their minds.
I had decided as of 1st jan to go to printing off my patterns then I thought ok I don’t have to do that.
Now its appears I will have to print them and use royal mail.
Do we know if we can still send digital files to non EU countries such as Canada, USA, New Zealand, Australia, Indian etc as that’s where most of my knitting patterns go, without having to go through this MossVat system?
.
Eileen @EileensCraftStudio the new VAT rules only apply to EU countries.
They don’t apply to your own country of residence in the EU and all other countries outside of the EU.
So you would be fine sending digital files to those countries and not have to do anything for VAT.
But on Folksy I don’t think you can exclude just non-EU countries. You would have to exclude the whole of Europe as Folksy have lumped EU and non-EU together.
I have heard on the Etsy forums that Ravelry are taking care of the VAT side of things for sellers.
Shirley x
You don’t need to print out the patterns Eileen.
It might work out cheaper to put them on a CD and post that out.
Shirley x
Would cd cost less then paper and printer ink and I wonder what the difference would be between posting a CD or posting Paper mmmm I’ve not done a cost analysis yet.
And yes you’re right Shirley about Ravelry but I think there’s an extra charge to cover the admin but I’m not completely sure.
Excellent about the non EU countries I had a feeling the infor I saw on someone blog (can’t remember which now, read so many of late.) was a bit iffy.
Depends on how many CDs you bought at a time, but I’ve had a look and I think I can do it via CD for about £2 including postage. That’s why I am going down the line of multi pattern CDs rather than trying to sell one at a time and effectively giving them away.
@EileensCraftStudio I think it would depend on how many pages and how much colour ink you use Eileen.
I already have a few on cds anyway, because I did offer them on Ebay a while ago and Ebay don’t allow you to send email files. CDs are quite cheap to bulk buy too.
I offer my needlework patterns with a black and white chart and a colour chart, plus they are several pages long.
So for me CDs are definitely cheaper. Ink is expensive and paper can weigh quite heavy.
Shirley x
Good points Shirley
I’ve been looking at my knitting patterns they are usually 2 to 2.5pages and I only use one small colour photo of the completed item.
I’m now looking at CD’s and will be making out a spread sheet.
There is a useful summary of HMRC twitter replies here
My reading of this is that because when selling through Folksy I have to manually input my buyer’s details into an e-mail and attach a PDF, this consitutes more than minimal human intervention, so my Folksy tutorials do not count as Digital Services and are therefore not covered by this rule change. If I had some kind of clever API my end which took the sale notification from Folksy and turned it into an automatic e-mail then I would be subject to the rule change, but I don’t.
Sadly the same tutorials sold through Etsy on the other hand are probably in trouble as these are on instant download and therefore do not require any human intervention. This is a bit of a *** because obviously instant downloads are better for buyers and sellers alike, but that’s my problem in terms of which platforms I choose to sell through.
So the crux is that without digital downloads Folksy seems to me to be safe, so I don’t think you need to cut across to CDs or paper guys.
I’m not an expert, so please do say if your reading of the HMRC guidelines particularly around manual e-mailing is different. Does anyone know if we can get official Folksy guidance on this - presumably they have accountants (unlike us!!)?
Unfortunatly our minimum human intervention ie attaching our pdf files to an email isn’t enough for them. 
Eileen, that was my understanding too based on various forums (mainly Etsy) until I read through the more recent twitter Q&A - the summary I linked to is from HMRC’s blog so presumably can be considered reliable - scroll right down to the bottom and you will see:
What is “minimal human intervention”?
This is where the sale of the digital content is mostly automatic but the small amount of manual process involved does not change the nature of the supply from an e-service - for example a customer clicks “Buy Now” button on website and
vendor receives notification and clicks a button, which produces an email pre-populated with the customer’s details and containing content which is sent to the customer; or
vendor receives notification and clicks a button which produces an e mail pre-populated with the customer’s details. Vendor attaches content and sends customer e-mail by clicking “Send”
In both cases these would constitute an e-service
When does the “human intervention” exceed “minimal”
This is where the amount of manual process involved in the sale means that the service ceases to be an e-service. In these cases the website functions as a “shop window” for the sale rather than also providing the mechanism by which the sale is made – for example
a customer clicks “Buy Now” button on website and is added to a list. At end of day the
vendor takes list, manually completes an e-mail
with each customer’s details, attaches the relevant content and hits
“Send”;
or a customer emails vendor with details of the products
they wish to purchase. Vendor manually replies to email and attaches
the content.
I would have thought that attaching in the way that I do (Folksy send me the purchase notification and then the payment notification, then I put together an e-mail with the PDF attached to it) is closer to the ‘exceeds minimal intervention’ definition and for Folksy sales I’m going with that for now. I will of course be printing the blog post out and saving it somewhere safe!
It would seem that E*sy’s digital downloads would fall into the “minimal human intervention” category, so I’ll have to take those down. But burning a CD, or collecting the order details and manually typing in the email address and attaching a pdf would be enough human intervention to stop it being VAT-able.
That’s how I read it.