From 1 April 2017, the VAT treatment of colouring and dot-to-dot books will change. Although they will broadly remain zero-rated where suitable for children under 18, standard rating may apply where they are for adults.

HM Revenue & Customs (HMRC) will not, however, seek to collect VAT on adult colouring books sold before this date (as long as the content was suitable for children).

What is a book?

There has been a phenomenal growth in the range of colouring and dot-to-dot books available, many of which are labelled as for adults. Whilst these have been sold as zero-rated books (like a paperback or hardback novel) under VAT Act 1994, Sch. 8 Group 3 Item 1, this does not necessarily accord with case law, claims HMRC.

In HMRC v Colour Offset Ltd [1995], the High Court found that a book is produced on paper or card, consists of a number of leaves and is bound in a stiffer cover. In addition, the book must be designed to be ‘read or looked at’.

Although adult colouring and dot-to dot books do satisfy most of the conditions, HMRC says they are not designed to be read or looked at, but are designed to be completed. Any text in the books is, it says, there just to support the colouring or to help join the dots.

Children’s picture and painting books

Even if these books are not zero-rated under Group 3 Item 1, HMRC says they could still be zero-rated under Item 3 of that Group as ‘children’s picture and painting books’, if suitable changes are made.

HMRC points out that most of the content of books currently sold as ‘adult colouring books’ or as ‘suitable for grown ups’ are also suitable for children under 18, but the way they are marketed, in HMRC’s view, prevents them from being eligible for zero-rating.

HMRC will accept colouring or dot-to-dot books are zero-rated unless they are:

  • marked as suitable for adults or grown-ups
  • held out for sale in shops with other adult books that are unsuitable for children, or are not appropriately marked as suitable for children when for sale online
  • contain images of an adult nature

If a book meets any of these three conditions, it will be a standard rated supply from 1 April 2017.

Treatment of supplies made prior to 1 April 2017

HMRC does not intend to recover VAT on colouring or dot-to-dot books sold prior to 1 April 2017, where the content is suitable for children under 18 – irrespective of how the books were marketed at the time.

However, books containing adult images (as per VAT Notice 701/10) will not be treated as zero-rated, as the content could never be seen as suitable for children.

The change of view with effect from 1 April 2017 gives publishers, wholesalers and retailers time to sell their existing stocks and review their future marketing strategy.

Correcting errors

If VAT has been declared on colouring books which were suitable for children, HMRC will consider claims for overpaid VAT.

If you would like to discuss any of the issues raised in this article, please contact a member of our VAT team.


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