Thursday 18 December 2014

Changes to Pattern Sales

You might be aware that there are some changes to the way VAT (Value Added Tax) is set up in the EU on digital services, which includes pattern sales. From 1st January 2015, the VAT will be charged at the rate set by the European country in which the purchaser lives. Previously it was set at the rate of the country the seller was in.  As I didn't sell enough to warrant paying VAT, you, as a pattern purchaser didn't have to pay it on my pattern sales.

There has been some complicated too-ing and fro-ing on Ravelry about how designers within the EU can still sell their patterns without having to register for VAT in every EU country and they have come to an agreement with LoveKnitting who will become the EU distributors of Ravelry pattern sales. They will collect the correct VAT for each EU purchase and ensure it gets to the right country.

Originally when these changes were announced I thought I would have to stop selling my patterns because I couldn't afford to set up a complicated system that paid VAT to all the different countries. I don't sell enough patterns to warrant that. LoveKnitting has been instrumental in keeping a lot of EU designers in business in the New Year.

So, the implications from the 1st January 2015 are as follows:

You live outside the EU

There will be no change to your purchasing experience.

You live within the EU

When you purchase one of my patterns you will be directed to LoveKnitting and you will make your payment to them, with the relevant VAT on top of the pattern price. You will be able to download the pattern, which will also be placed in your Ravelry library, as before.

If you live in an EU country and don't want to pay VAT on top of the pattern price, you need to buy your desired pattern before the end of 2014.

I hope this new system will work as planned and there will be very little disruption to pattern sales as the changes take place.


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