VAT Liability of Colouring & Dot-to-Dot Books

Due to the rise in popularity of ‘adult colouring books’ and ‘adult dot-to-dot books’, HMRC have outlined their policy regarding the VAT treatment of these items.

 

Whilst these items do not qualify for zero-rating by way of Item 1 of Group 3 to Schedule 8 of the VAT Act 1994 due to being designed to be completed, as opposed to ‘read or looked at’, they may qualify for zero-rating under Item 3 of Group 3 of the same Act, as ‘children’s picture and painting books’. Therefore, from the 1 April 2017, colouring books that are suitable for children under 18 years of age are liable to the zero-rate of VAT, however if these books are marketed for persons over 18 years of age they must be charged to the standard rate of VAT.

 

In order to qualify for zero-rating, colouring or dot-to-dot books must not;

-          Contain adult images depicting profanity, violence or illegal acts;

-          Be held out for sale with other adult books that are unsuitable for persons under 18 years of age;

-          Be marked as suitable for adults.

 

If you are a wholesaler or retailer of books and are unsure how the implementation of this policy will affect how your business accounts for VAT, or you have accounted for VAT on colouring books suitable for those under the age of 18 and wish to claim overpaid VAT, please call our free VAT helpline for expert advice.

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