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Court rules that photo album is a book for VAT purposes

 A three year court battle has finally ended with a ruling that HM Revenue and Customs should not have collected tax from photo-processing firm Truprint for the sale of printed photo albums as they are classified as books and should be zero rated supplies.

Truprint’s customers were offered the option of creating a photo album online by choosing their own photographs and design which would then be printed by the company and bound together in the same way as a book. HM Revenue and Customs collected VAT on the photo albums claiming that they were not books and therefore were chargeable for VAT.

During the period from 2006 to 2009 Truprint paid a total of £545,800 in VAT for the books. The ruling by the tribunal that the VAT was collected in error means that HM Revenue and Customs must repay the tax as well as an estimated £500,000 for the company’s costs including legal fees and any additional VAT collected from 2009 to 2011.

In his ruling Judge Berner pointed out that the fact that the photo-album was mainly pictures did not prevent it from being treated as a book. He stated: ‘The nature of the content, provided it is something that can be read or looked at, is not, however, material. A book can have content that is exclusively text, or exclusively material such as photographic images or diagrams or drawings, or any mixture of that content.’

Truprint’s finance director and company secretary, Graham Clark said: ‘We spent three years and £250,000 in legal fees fighting this case. We feel common sense has prevailed and the tribunal has erased any uncertainty about whether a book wasn’t a book.’

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