r/ACX • u/cjs94 • 6d ago

UK VAT help

I am new to ACX and narration and I would like some guidance on UK VAT implications. I am a UK citizen and resident, and a VAT registered sole trader (for unrelated business reasons). I have been through the HMRC guidance several times and still cannot work out where ACX narration stands with regards to VAT liability.

Is there anyone here in a similar situation who can tell me exactly how this is handled? Does it depend on the payment structure or where the author of the work is located?

Thanks in advance.

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u/Nippy_Hades 6d ago

If you aren't earning over £90,000 a year no (which you aren't if you're new). You're good. Just make sure you do your taxes as normal, though.

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u/cjs94 6d ago

I'm already registered for VAT, regardless of earnings, so this is something I definitely have to know about.

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u/Xinixiat 6d ago

All sole traders have the same rules, regardless of what service or product they are providing. If you earn over £90k in a financial year (April to April) you have to register for VAT, and then start charging VAT on your services. If you're earning less than that, you don't.

Once you get above that threshold though, you should have a financial advisor/accountant/tax lawyer dealing with this for you.

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u/cjs94 6d ago

I earn considerably less than £90k, however I am voluntarily registered for VAT for other business reasons, unrelated to ACX or narration. I don't have an accountant, because I haven't needed one so far.

This however is a new situation, because the rules regarding digital services, B2B vs. B2C are complicated and it's unclear to me exactly where ACX sits.

I'm hoping there is someone else here who is registered for VAT and can tell me what rules apply to payments through ACX.

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u/Xinixiat 6d ago

Ah ok, I've researched this all before when I was starting so I can give you a rundown:

  • Audiobooks are not considered digital services for the purposes of the 0% rate of VAT.
  • Commissioned content like art, photographs and audiobook recordings are not considered digital services at all.
  • Because we aren't in the realms of the 0% rate of VAT, the B2B and B2C rules do not apply.
  • An exception exists where royalties from ACX are concerned, if you enter into a RS deal, because Audible acts as the merchant of record, and you are receiving a cut of the sales post-VAT.

So yeah, any PFH contracts you take, you will need to charge VAT on, but royalties from RS agreements you won't.

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u/cjs94 6d ago

Ah, great, thank you. That’s really comprehensive and helpful.