VAT rate journalism in The Netherlands
Most of the work done by journalists is exempt from VAT. However, in some cases you, as a journalist, might do journalism-related work that is not legally acknowledged as a journalistic activity. For these activities, you will need to pay VAT. In this article, we will tell you more avout the boundary between journalistic and related activities. This way, you will know when you are obligated to charge for VAT.
What is journalism?
According to the Law on Revenue Tax** journalism is the creation of a journalistic activity. The Court of Justice* has declared in 2008 that activities can be acknowledged as journalism “when the purpose is the publication to the general public of information, opinions or ideas, regardless of the transfer medium”. So both a YouTube video with a personal opinion as a science article in a newspaper can be seen as journalistic activities. Provided that information, opinions or ideas are publicly published. The term journalism therefore encompasses a large spectrum of activities. When it is a matter of the creation of a journalistic activity, then the exemption of the revenue tax applies. The Tax Authorities can test the legitimacy of the journalistic activity. However, as a journalist, you can have related work that is taxed with VAT. In this article, we will show you the boundary between these two activities and what this means for your administration.
Lectures and talks
When a writer or journalist gives a lecture, then these are generally exempt from the revenue tax. Any other individual giving a reading about a certain subject would not be exempt from the revenue tax and is obligated to pay 21% in VAT. However, when you, as a journalist, are a member of a panel or participate in a game show for which your own work is not used, then you are obligated to pay 21% in VAT to your client.
As you may have noticed earlier, the activities you perform as a journalist are exempt when it is a matter of the creation of a journalistic activity. In short, fiscally, you can speak of a journalistic activity when you collect or publish news. This ‘news’ can contain facts, but also opinions, visions and thoughts. These will need to be of a journalistic nature. It does not matter whether you work for a journalistic institution. However, as a journalist, you may write articles that are not related to the news. For example, commercial texts or blogs. When a journalist writes a text for a flyer, a manual or a website of a business, then these are not considered journalistic activities. The work then is taxed with 21% VAT.
Deduction of pretax
When you do work that is exempt for 100%, you are not entitled to deduction of pretax. This means that you cannot reclaim the VAT on your expenses from the Tax Authorities. When you are only performing activities of a journalistic nature, as described by the Court of Justice, you do not charge VAT and cannot reclaim VAT.
When you are partially doing exempt work and partially doing taxed work, then the VAT on your purchases are deductible pro rata. This means that if 60% of your work is taxed with VAT and 40% is exempt from VAT, the VAT on your purchases are deductible for 60%. For example, when you have paid €500,- in VAT in a one period, you can declare €300,- as pretax in your tax declaration. So, that €300,- is deductible from the VAT you need to pay.
Exemption with the KOR
Until 2020 you could be exempt from the VAT with the Small Entrepreneurs Scheme (KOR) when you paid less than €1.345 or €1.883 in VAT annually. When you paid for VAT for incoming invoices, you could reclaim that with your VAT declaration. Starting January 1st, 2020 the KOR has changed. As a self-employed professional, you can be exempt if your annual revenue is less than €20.000,-. The new administrative exemption means you do not deduct paid VAT, and you also do not charge for VAT. You do not have to invoice or do a VAT declaration. The new KOR is a voluntary scheme and used primarily when you have private clients. For them, the price reduces when they do not have to pay VAT. As a journalist, you (probably) also have business clients. In that case, the scheme is less appealing. Because your clients, can usually deduct the VAT on incoming invoices anyway. And you cannot reclaim the VAT for incoming invoices anymore.
Do you still want to make use of the KOR? Then you can request a dispensation with the Tax Authorities. When you make more than €20.000 in revenue, then you will have to cancel your dispensation. Pay attention: after you have canceled, you cannot apply for the new KOR for three years.
VAT and journalism: Would you like to know more?
When you do journalistic work as a self-employed professional, it is important to know what activities fall within the realm of journalism and what activities do not. Do you do work that does not meet the criteria of journalistic work? Make sure you know how to tax these activities and that you make use of the possibility of reclaiming your VAT. Would you like to know exactly what your situation is? Check the website of the Tax Authorities* or the Dutch Association of Journalists.
*Need help with navigating Dutch websites? Contact us!