Royalties and VAT

Royalties and VAT

Didn't find your answer?

I have a client who receives publishing royalties (currently below VAT reg threshold, but that may change in the next year or so). If they register for VAT on a voluntary basis, they can reclaim their input VAT. Regarding output, it is all chargable at 17.5%, and they either issue a sales invoice or the publisher deals with it on a self billing basis.

They also receive an advance in January 08 for 2008 royalties, then receive a balance in January 09 based on actual figures, taking into account the advance. Output VAT is charged on both amounts.

Is all the above correct?

Thank you for any comments.

Alan

Replies (3)

Please login or register to join the discussion.

avatar
By carnmores
28th Feb 2008 18:41

not quite
the January advance will only be vatable if composers was registered at the time of receipt. this is a recoupable advance against the royalties due later.

ed advance recd Jan £100 no vat, royalties sept £120 less advance = £20 + £3.50 vat

Thanks (0)
avatar
By User deleted
28th Feb 2008 09:16

Tarun
thank you.

Thanks (0)
avatar
By tarun999
27th Feb 2008 13:36

Correct
All the above is correct from a VAT reporting perspective.

Thanks (0)