Annette Green Authors' Agency

Ms Green represents a friend of mine who writes YA with a slightly alternative edge: not sure you'd call it fantasy, but it's not straightforward realistic/gritty stuff. She's a pretty damn fine agent and one I'd recommend without missing a beat.

From conversations with my friend she's very approachable, professional and helpful. Oh, and good at her job, too. I'd bet she'd be perfectly fine with that.

A friend of mine who lives overseas emailed and asked if she would accept an attached file. and she said yes, a word doc was fine. Apparently she will only accept them with prior arrangement.

Annette Green Agency

At Annette Green Agency they mention that they charge VAT at the full rate. Is this typical practice? I haven't heard it mentioned before.

Details down the page:
http://www.annettegreenagency.co.uk/aboutus_66533.html

Our commission rates are: UK Sales 15%; US Sales 20%; Translation Rights 20%; Film and TV Rights 20%. Commission attracts VAT at the full rate. We do not charge any reading fees.

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Well my question seems to have gotten lost in the move, I was really more interested in the question of VAT in general. For those that mightn't know, VAT is Value Added Tax here in Ireland and in the UK. I can't find any other information on agents charging tax on top of their commission.

I don't know whether Annette Green Agency are being upfront about a common agency practice or if they're the only one doing this, but if you already pay income tax on the monies earned from your books, wouldn't this mean you were paying tax twice?

Pippi said:

... but if you already pay income tax on the monies earned from your books, wouldn't this mean you were paying tax twice?

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I can't speak to standard practices, but as far as this last question goes, no, you wouldn't be paying taxes twice. You only pay tax on your actual income. Any monies paid to an agent is one of your business expenses, which is deducted from your income.

I tried checking the VAT charges in the UK, it would bring their commission rate up to about 17%. If the extra percent is classified as tax there is the possibility you can claim it back.

Pippi said:

I tried checking the VAT charges in the UK, it would bring their commission rate up to about 17%. If the extra percent is classified as tax there is the possibility you can claim it back.

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Um, no. Monies paid to an agent are classified as business expenses. You don't pay tax on your business expenses.

To use a simplistic example, let's say you got an advance of £1,000, and let's say the agent gets 15%. Your tax liability is £1,000 - £150 = £850.

If the agent takes their VAT out of your share (which seems wonky to me, but I honestly don't know standard practice for UK agents), then instead of getting £150 they'd get £180. Your tax liability is then £1,000 - £180 = £820.

Of course, chances are you'd have other expenses than just the agent's commission. This is just a simple example.

You wouldn't be claiming tax back, because you wouldn't have paid tax twice. You only pay tax on your income, not on your expenses, too.

Wait for somebody to confirm, but I *believe* that is normal. VAT is due on goods, services, and materials. Agents charge VAT the same as Builders charge VAT.

It would not, as Terie explains, mean you pay tax twice.

Fine, forget the whole twice thing. I've just never seen it mentioned as an agent's expense before. However I may have misinterpreted what they meant, hence the question back at 'ask the agent'. But why are things like photocopy charges mentioned and not VAT?

Because VAT is not something the agent charges, it's something the government requires a service provider to charge.