Personal finance updates
Sign up for myFT Daily Digest to be the first to hear about Personal Finance news.
The zero VAT rate for e-books has been brought forward due to the coronavirus lockdown measures, meaning savvy readers will pay less to download e-publications to e-readers and tablets.
The change was due to take place in December 2020, but will apply from May 1, recognizing that many people are confined to their homes and that schools and libraries remain closed.
Antje Forbrich, VAT Director at Blick Rothenberg, the tax advisor, said: “This alignment of VAT treatment for physical and digital publications will be good news for publishers and consumers, provided the VAT savings are passed on to end consumers.
However, she added that not all electronic publications will benefit from the zero rate. “Electronic publications primarily devoted to advertising or containing audio and / or video content, and audio books themselves, will remain subject to the 20 percent VAT rate,” she said.
When subscription services for eBooks have been billed in advance and VAT has already been paid in advance, HM Revenue & Customs will allow vendors to issue credit memos and refund VAT to customers. consumers for the proportion of the annual subscription that extends beyond May 1, 2020.