UK VAT rules for printed leaflets, flyers, brochures, booklets etc
The UK government's rules for VAT on printed matter are complicated - particularly in relation to VAT on leaflets and flyers.
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 (HMCR) as standard rated (in other words, you must pay VAT at 20%). This includes stationery items (letterheads, compliment slips, business cards etc), postcards, folders, invitations, posters, tickets and greetings card. However, there are exceptions:
Most books, booklets, brochures, pamphlets and leaflets are VAT zero rated (you do not pay VAT). However:
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' which are intended to be displayed in shop windows would be classed as posters and would be subject to VAT at 20%;
If a leaflet is designed to accompany some other product or service, for example an instruction leaflet, it is classed as VAT zero rated. However, if the leaflet's 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. An example would be a calendar.
Finally, 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 of the leaflet.
Below is an extract from VAT Notice 701/10, 'Zero Rating of Books Etc.'
3.1 Books and booklets
These normally consist of text or illustrations, bound in a cover stiffer than their pages. They may be printed in any language or characters (including Braille or shorthand), photocopied, typed or hand-written, so long as they are found in book or booklet form.
Supplies of any of the following are VAT zero-rated:
directories and catalogues;
collections of letters or documents permanently bound in covers;
loose-leaf books, manuals or instructions, whether complete with their binder or not;
and amendments to VAT zero-rated loose-leaf books, even if issued separately.
School work books and other educational texts in question and answer format, are VAT zero-rated because the spaces provided for the insertion of answers are incidental to the essential character of the book or booklet. The same applies to exam papers in question and answer format provided they qualify as books, booklets, brochures, pamphlets or leaflets.
But supplies of the following are VAT standard-rated:
books of plans or drawings for industrial, architectural, engineering, commercial or similar purposes;
picture card and stamp albums, unless they contain a substantial amount of reading matter which is complete in itself, and no more than 25% of the album is set aside for the mounting of cards and stamps;
completed stamp albums; and
products that are essentially stationery items, for example, diaries and address books.
3.2 Brochures and pamphlets
These are not defined in law and whether a particular product qualifies as a brochure or pamphlet is a matter of fact and impression.
Brochures usually consist of several sheets of reading matter fastened or folded together, which 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.
Single sheet brochures and ‘Wallet’; type brochures designed with a flap may be VAT zero-rated provided they:
convey information; and
contain a substantial amount of text, with some indication of contents or of the issuing organisation;
and are not primarily designed to hold other items;
and are supplied complete.
These are also not defined in law and again whether a particular product qualifies as a leaflet is a matter of fact and impression. Leaflets normally:
consist of a single sheet of paper not greater than international standard A4 in size (larger publications up to A2 size can be VAT zero-rated provided that they are printed on both sides, folded down to A4 size or smaller and meet the other conditions);
are intended to be held in the hand for reading by individuals (rather than for hanging up for general display);
are complete (and not a part work);
are supplied in sufficient quantity (at least 50 copies) to permit general distribution;
are printed on limp paper;
and will either be of an ephemeral nature (designed to be read a few times and then thrown away) or be designed to accompany some other product or service, for example an instruction leaflet.
Items printed on stiff paper and card are not automatically excluded from the definition of leaflets. However we do regard the use of stiff paper and card as an indicator that the items have a function which would exclude them.
For example if the item’s main function were designed to be kept or used for a specific purpose in its own right, rather as ancillary to another supply, it would not be a leaflet. Examples of items that would not be leaflets would be those designed to be used for any of the following:
as a calendar;
to obtain admission to premises;
to obtain a discount on goods or services;
as reference material; or
for completion or return (see paragraph 3.4).
We consider that items printed on laminated paper are designed to be kept and therefore not leaflets. On the other hand, orders of service are not normally designed to be kept and may be VAT zero-rated.
3.4 Items with areas for completion
Items which might otherwise be considered to be leaflets, brochures and pamphlets may not be VAT zero-rated if they are primarily intended for completion or detachment.