…but it’s not your fault, and I’m here to help. TAX DOESN’T HAVE TO BE TAXING (apparently…)!
[Last edited 15/10/21 after input from kind tweeters – I feel this may be a document that grows!]
This article will be most useful if you are:
A UK-based, non-VAT registered musician selling your wares to music fans in EU countries via Bandcamp.
It will also be some help if you are:
A musician based in a non-EU country besides the UK selling via Bandcamp.
A UK-based, non-VAT registered person selling things via Etsy / eBay / any other platform that has agreed to act as a Marketplace and collect VAT from your customers on your behalf.
Why should I care? I’m busy just trying to get through the day!
Me too, me too. BUT, if you don’t do this properly, your customers will probably get charged VAT twice. When they pay VAT at checkout, they’re charged between around 20-28% of the order value (depending on their country), but when they get charged on delivery it can be quite a lot more. That sucks on its own, but if they’ve already paid the VAT they’re going to be, rightly, annoyed.
Please note: I am pretty handy at a lot of things, but I’m not a VAT expert, an accountant or a financial advisor. I’ve read a lot of quite boring articles in recent weeks in an attempt to get my head around this issue and make sure I’m doing things properly, and it’s annoyed me so much that this information was so hard to find that I’m collecting it here to save you the headache.
I’m not going to wang on about every detail, I’ll just share the pertinent facts so you can make sure your customers won’t get charged twice for VAT.
Caveats complete, let’s get started.
VAT? What? Why? Who? How?
In July 2021 the VAT laws changed. Prior to Brexit, sending a merch order from the UK to Germany wasn’t considered an import, because we were all part of the EU (oh, happy times). Now the same merch order is considered to be an import, and VAT needs to be paid.
You might remember that back in late 2014/15, the rules changed so that people in certain countries had to pay VAT on digital goods, and Bandcamp kindly stepped in and agreed to deal with that for everyone selling through them.
This year, they agreed to do the same for physical goods. Thank goodness! If they hadn’t, I would have had to register for VAT in the UK (regardless of turnover) in order to be able to sign up for the IOSS scheme to charge VAT on EU orders sold to the EU. If that sentence made your brain freeze you should be especially grateful that Bandcamp are helping us out…
BUT there’s a gap!
Connecting the dots…
Unlike other platforms acting as “Marketplaces” e.g. eBay and Etsy, Bandcamp didn’t send any information out to us sellers to explain how the system works, and to let us know that we need to connect the dots for the postal system.
This did annoy me. I’ve been selling music and merch through Bandcamp since 2009, and I’d hoped for more guidance. Bandcamp are brilliant, they offer such a wonderful service for us and I still love them very much, but this didn’t need to be so difficult.
As I have my own Shopify shop as well, I knew I needed to read up on the new VAT rules to make sure I was doing things right over there, and it was only while doing so I discovered the aforementioned Bandcamp gap.
Skip this paragraph if you’re only selling through Bandcamp or another Marketplace. If you’re running your own shop, you can still sell physical goods direct to EU customers from your own shop e.g. Shopify / Squarespace etc BUT if you’re not VAT registered you can’t collect the VAT at checkout (because that would be illegal) which means the customer has to pay at their end when the order arrives. You cannot sell digital goods direct to EU customers from your own shop, though. I’m trying to find a service to plug in to my Shopify checkout which will act as a Marketplace a la Bandcamp etc so I can sell digital and physical goods and get the VAT dealt with but I haven’t found one yet. And of course there’s a limit to how much you can make without having to register for VAT in European countries (€10,000) as there is for the UK (£85,000).
OK, back to Bandcamp: at the end of September I got in touch with Bandcamp support and started trying to get to the bottom of the whole thing, and I received very little assistance from them. After the aforementioned hours of reading boring articles about the IOSS system, I figured it out and told Bandcamp I thought they should get in touch with everyone to explain this.
They didn’t respond, but a few days later my tweets on the matter were shared with the UK Director of the European Centre for International Political Economy.
That evening, Bandcamp sellers received this message:
“Recently, the EU implemented new rules regarding taxes on imported goods. All physical orders destined for the EU are now subject to the member country’s VAT. As a seller using Enhanced Payments (where Bandcamp processes the payments and makes payouts to your account), these taxes are automatically collected and remitted by Bandcamp at the time of sale.
Proof of this tax collection is provided by our IOSS ID, which you can find in your sales receipts and the packing slips on your Merch Orders page. This IOSS ID must be included on your package or accompanying customs forms; please check with your carrier or local post office if you have questions about implementation. Failure to include the proper tax information may result in additional tax or customs charges for your fans.”
What does that mean?
I’ve put the important bits above in bold – the main issue here is that when Bandcamp charge VAT to a customer, we the sellers have to make sure the postal carrier knows VAT has been paid, and prove it too.
How to do this will vary slightly from country to country, but surely not that much.
How to do it right (in the UK – adapt for your own country)
1) The best way of doing this is to set up a Royal Mail Click and Drop account, where you can pay for postage and print out labels and customs forms direct. The reason this is the best way, is that when your package arrives in the destination country it can easily be scanned and the IOSS number will show up.
There are two schools of thought on the next bit – some say printing the postage via Click & Drop as above is enough, because the order details will be contained within the QR code on the Royal Mail postage label BUT when I used Click & Drop I couldn’t find a place to detail the order amount, VAT paid etc. Unlike Etsy / eBay etc it’s not possible to export orders from Bandcamp to Click & Drop directly. So, without manually adding the order information in Click & Drop, if that’s even possible, I’m not confident I’m including enough information with packages.
What I’ve been doing is printing the Bandcamp packing slip showing the IOSS number and details of the VAT paid and tucking it inside a “documents enclosed” pouch, which I attach to the parcel. If I don’t do this, I can only imagine the postal carrier has to take my word for it that VAT has been paid.
Here are links for the “documents enclosed” pouches and the Avery J8169 labels I bought, though obviously feel free to shop around. These aren’t affiliate links anyway 🙂
PS – adding the Bandcamp IOSS number to your Click & Drop account is hard to figure out, so scroll down to the bottom for screenshots showing how to do that – this also applies to other Marketplaces like eBay and Etsy.
Stick this pouch to the envelope and add the postage / address label on top. Ta-dah!
2) Another way is to write the IOSS number and the Marketplace name on the front of your parcel, as well as printing the packing slip and tucking it into a “documents enclosed” pouch on the parcel as detailed above.
When I asked about IOSS at my small local Post Office, my (very friendly and helpful) PO worker shrugged, said “this is all we’ve been told about it” and handed me a sheet of stickers to fill out and put on the front of the envelope. I think for more known platforms like eBay / Etsy you just write the name, but I would add the IOSS number on these labels as well to be sure.
I use Royal Mail’s Drop & Go service a lot, so I might try these labels, but the Click & Drop system works well now I’ve got the labels and have tried it a couple of times.
How not to do it
I read on some forums that people have just been writing the IOSS number and the Marketplace name on their packages. That’s basically the same as using the ridiculously non-official looking Royal Mail stickers above but the issue surely is that without the “documents enclosed” pouch, the postal carrier in the destination country just has to take your word for the fact that VAT has been paid. Which, let’s agree, they probably won’t. It might work, it might not. For me, this is about making absolutely sure my VIP customers don’t have to pay extra fees, so I’ll just use the documents pouch method.
How NEVER to do it
You must only use the Bandcamp IOSS number for packages sold through Bandcamp where VAT has been charged. It’s illegal to use it on packages sold through other platforms, because it’s illegal to avoid paying the VAT. We’re running legitimate businesses here, so don’t be silly.
I’ve decided to block orders from EU countries on my Shopify store because 1) I can’t charge them VAT at checkout because I’m not VAT registered, so can’t join the IOSS system directly and therefore 2) don’t want them to have to pay over the odds at their end to receive the goods. As above, it’s still legal for me to do this, but it’s not ideal. I’m going to be directing those people to buy from Bandcamp instead, because it’s moderately less of a headache now I’ve got it figured out.
Any questions / comments?
I hope you’ve found this article helpful. If you have questions, drop them below in the comments. If I’ve got this all horribly wrong, I’d love to know. I’m not pretending to be an expert, just sharing the knowledge I’ve gleaned recently. Please be polite though, because life’s too short for anything else.
I promised you screenshots, and I am giving you screenshots.
How to add Bandcamp’s IOSS* to your Royal Mail Click & Drop account (And/or other Marketplace IOSS numbers of course, just set up a separate profile per Marketplace you sell through)
Wake up! I’m still talking! It’s pretty picture time anyway, we’re nearly done.
You need a separate Trading Name profile per IOSS number you use, so if you also sell to the EU via eBay / Etsy then make a separate Trading Name for each one. If you just use Bandcamp, you only need one. So…
2. Go to settings.
3. Click on Trading names.
4. Add a new trading name (or amend an existing one if it doesn’t already contain IOSS information you’re using)
5. Click for the dropdown menu in the “Pre-registration tax scheme and IOSS” box and select IOSS (European Union). Add the Bandcamp IOSS in that box (get it from your EU packing slips).
6. Click update in the bottom right corner of the screen and you’re good to go! Just make sure you use the correct Trading Name for the packages you send.
Additional notes
When I added postage to my EU orders I was asked for the IOSS number again in the customs information.
And until I entered the HS code for CDs I couldn’t proceed to checkout and print my documents. HS = Harmonized Commodity Description and Coding System. Every item you send has a customs code, and you can look them up here.
For reference, CDs are HS code 8523414, vinyl is HS code 85238090 and cotton t-shirts are HS code 61091000.
OK, that’s it, I suddenly feel very sleepy – let me know how you get on!
As an independent songwriter, producer and musician, releasing my new album this year was more of a challenge than usual. The UK government left venues with no choice but to re-open on “Freedom Day”, 19th July 2021, but I won’t be playing gigs for a while.
“I’ll Start A Fire” is a song about causing a ruckus even while everything is going wrong, cutting bad connections and ignoring all the noise in order to be free and express ourselves honestly. Taking whatever personal power we still have and making something with it, stopping ourselves from stopping ourselves.
As soon as I’ve decided I’ve got all the songs lined up for an album, I can rely on one or two cheeky musical ideas to come along and demand my attention.
“I’ll Start A Fire” was the first of two songs I wrote in September 2020 that jostled for a space on the record (the second was “Black Car”), and I’m so glad they did.
Giving yourself permission to be you can be one of the hardest things, and has really been a process for me, but it’s brought great joy and fulfilment to my life in recent years. I highly recommend giving it a try.
CREDITS
Written, produced, performed and recorded by Laura Kidd at The Launchpad, Bristol. Drums by Max Saidi. Mixed by Dan Austin. Mastered by Katie Tavini. Artwork by Alex Tillbrook, concept by Laura Kidd.
LYRICS
I stole a car in a dream And now I’m feeling paranoid Well I spent so long ignoring my instincts Now I’m searching to destroy
I’ll start a fire while the world burns I’ll start a fire, I’ll start a fire
So I sink these heavy words in a diary And take them all to heart Gonna build myself a fortress of vanity And then I’ll fall apart
I’ll start a fire while the world burns I’ll cut connections while the planet turns I’ll start a fire cos it seems we’re elbow deep In cheap banalities I’ll start a fire, I’ll start a fire
I’ll start a fire while the world burns I’ll cut connections while the planet turns I’ll start a fire cos it seems we’re elbow deep In cheap banalities I’ll start a fire, I’ll start a fire
THANK YOU for visiting my website!I’m Laura Kidd, a music producer, songwriter and podcaster based in Bristol, UK. It’s great to meet you.
Imagine this indie upstart’s surprise and delight on the weekend when a friend sent me this photo*.
Yes, that’s my artist name sitting pretty right near Billie Eilish’s face, with “Exotic Monsters” listed alongside Billie Marten, Counting Crows, Gary Numan, Gruff Rhys, Lambchop, Monster Magnet, Sara Bareilles, Twenty One Pilots and more. Wow.
All this talk of the album charts recently might have made you think I’m selling out.
I’ve spent my music career as the underdog with a punk spirit, sneered at by the blogosphere for releasing my own albums in the early days, and largely ignored now that way of working is more common.
I’d be lying if I said this never bothered me – I am only human, after all! – but on a decent day when I’ve exercised, drunk enough water and am feeling on top of my workload, I’m absolutely fine with being a niche artist. I get to make whatever music I like and communicate directly with you. It’s great!
When I ended She Makes War in 2019, I told you:
“the more I toured and released music, communicating with a growing army of ardent supporters, the more inappropriate [the name She Makes War] started to feel. I was no longer alone; putting my heart and soul into sharing music with those who wanted to listen introduced me to most of the key figures in my life, led me to move city, gave me a deep connection to thousands of open-hearted people around the globe, brought invitations to share stages with my heroes and started to financially fuel the making of new music.”
I’m so thankful for the encouragement I’ve received from music lovers over the years, because I really did need to be shown that what I was making had value to others. I don’t come from money, I am a self-taught singer, guitarist, bassist and producer, and plenty of people have tried to dissuade me from doing my own thing, my own way.
But not you! Thank you. Relaunching my solo project with a new name and outlook last year was a gamble, but I knew I needed to be true to myself now, rather than dragging my old self along forever just so that no-one would lose track of me online.
In our digital world of likes and reach and engagement, it’s hard to detach from all the numbers flying around. How many people liked this photo? How many people shared this tweet? How many people love me today?
The reaction we have to art is unquantifiable – a song could change my life forever but I can’t communicate any of that impact when I click “like”. Yes, I can see how many people have listened to one of my songs on a streaming site, but I don’t know who’s been comforted or encouraged today, who’s spent an hour relaxing in their favourite chair, drinking tea and listening to one of my albums on vinyl, eyes closed, pondering the world and their place in it.
We all have to be careful not to attach our self worth to a bunch of numbers that we have no control over. Indie artists, especially, have too much access to surface level facts about how everyone else is doing (or how it *appears* they’re doing). “Comparison is the thief of joy”, indeed.
So, fuck the numbers. But also, fuck the system. I said in my recent video that every pre-order for “Exotic Monsters” is a vote for the spirit of independence that brought me to live in Bristol nine years ago. That spirit was already in me, and in Bristol I saw an opportunity to create a life where I could spend more time making music, instead of having to work such extreme hours for other people.
It took me until February 2019 to trust enough to quit all my freelance work and hunker down to start writing this new collection of songs, fuelled by my Supersub Club patrons. Every creative project is a voyage of self-discovery, but making this album led me to end She Makes War, launch Penfriend, launch my podcast, and put The Correspondent’s Club front and centre.
This record has effected positive change in my life; it means way more to me than a number on a chart, but I’m really not trying to be disingenuous when I say this would be a win for all of us.
Yes, a top 40 placing would validate me – my music and my way of working – but I see it as a huge victory for independently-minded music fans, who are able to trust their own ears and hearts over relentless radio playlisting and £50,000 a week billboards (actual cost).
“Exotic Monsters” has already beaten the final placing of my last album “Brace For Impact” in 2018, and my past self is the only person I’m in competition with. We’ve started receiving weekly counts telling us the number of records sold for chart positions from 1-200, and at the time of writing we have a top 100 album on our hands (BFI went to #108 overall and #15 in the indie chart). I try not to overuse the word, but that feels pretty amazing to me.
I grew up listening to chart music, watching careers be made by radio and press support, then hearing about bands walking away from their deals empty-handed. I had no realistic blueprint for a sustainable career making music out of thoughts and thin air, so I made it up as I went along.
I’d talk about smashing the system, but I think it’s been broken for a long time. This is a chance to show that another way is possible.
I have massive news to share with you today: my new album “Exotic Monsters” is two thirds of the way towards getting in the UK Top 40 Album chart!
Throughout my years of making music, I’ve always been told that you need a manager, a record label, an agent, a huge marketing budget, your face on billboards, features in magazines, radio playlisting, all that sort of thing, to even have the tiniest chance of this sort of success – but that’s clearly not true.
I make and release my music completely independently from my little attic room in Bristol.
If “Exotic Monsters” gets into the UK Top 40 chart, it’ll make Bristol music history. The last Bristol-based female artist to get in the top 40 albums chart was the brilliant Beth Rowley in 2008, and we don’t even know if there’s ever been a completely independent Bristol-based act with a top 40 album. How bonkers is that?
Every pre-order that has come in so far is a vote for the spirit of independence that brought me to live in this city nine years ago.
I’ve built an audience by sharing my work online and treating people with respect – it’s definitely the slow way round, but it’s the one that makes me the happiest. I feel so encouraged and supported by everyone who has hopped on board so far. Thank you.
“Cavernous as its darkly-elliptical tale unfolds, “Seventeen” careens with compassion” – The Autumn Roses
“An enormous pop-rock anthem with a heart-throttlingly poignant story [by] Penfriend aka singer/songwriter/producer/genius example of how to do independent musicianship right, Laura Kidd” – Loud Women (single of the week)
ABOUT THE SONG
Seventeen. Is there a more complicated age? Not quite yet an adult, but impatient to be treated like one; navigating an avalanche of new experiences and urgent emotions, dismissed by the grownups as “teenage angst” or “just a phase”. An exhausting quest to negotiate a new space for ourselves, juggling the interests of parents, teachers and friends while not knowing to question their motives.
This song is an excavation, a letting go, an act of self-forgiveness.
Traumatic events from the past can feel just as fresh, years later, the ghosts of our former selves creeping up to tap us on the shoulder with icy fingers.
Sometimes we need to package up our memories with tidy words to dispel the haunting.
Sometimes we just need to stop blaming ourselves.
Sometimes writing songs is like painstakingly sculpting sounds from thin air; other times they arrive in a whoosh, fighting to be heard. “Seventeen” appeared on a summer Saturday evening, falling out of me in jagged swathes.
Facing up to our ghosts isn’t a pleasant experience, but this song helped me over a major stumbling block from my past, bringing me a fresh perspective and new freedom.
CREDITS
Written, produced, performed and recorded by Laura Kidd at The Launchpad, Bristol. Drums by Max Saidi. Piano arranged by Laura Kidd, performed and recorded by Catherine Anne Davies. Mixed by Dan Austin. Mastered by Katie Tavini. Artwork by Alex Tillbrook, concept by Laura Kidd.
LYRICS
Happy birthday, time to say goodbye Such a big girl, keep all this inside Dial back those dreams Wishing impossible things Bursting your seams It hurts when we grow
Tell me what you wanted I was seventeen Tell me I deserved it Because I was seventeen
Toxic teens on mixtape afternoons Photostatic memories of you Fold paper planes Pull them apart when it rains Smash windowpanes Stretching our wings alone
Tell me what you wanted I was seventeen Tell me I deserved it I was seventeen Tell me it was all my fault I was seventeen Tell me you remember
Tell me what you wanted I was seventeen Tell me I deserved it I was seventeen Give me a good reason I was seventeen Tell me you’re so sorry I was seventeen
+ I make a podcast called “Attention Engineer”, where I speak to fellow artists about creativity, grit and determination. Visit this page to find out more.
“Black Car” is a song about love and death, guilt and gratitude, taking time to figure out what’s most important, feeling desperately sad and isolated and grieving the loss of so many. Dealing with anger and frustration at the UK government for making so many missteps. Trying to keep on keeping on, while finding it hard to see a way out of this, however many “roadmaps” are announced. Accepting – and feeling – our feelings.
“That this single release marks the first anniversary of the first UK lockdown is an accident, but sometimes things just fall into place like that when we focus on what’s important to us. Throughout this loneliest of years, I’ve tried to keep connected to humanity through making and releasing new music, podcast episodes and my weekly emails, doing what I can to create pinpoints of light in dark times. With all the gratitude in the world, I have to remind myself it’s still ok to feel wounded by what’s been going on and to feel scared about what’s to come. We will all be changed by this experience, and at the root of everything is the love we have for others.”
I don’t know what other bands “Black Car” sounds like, or have any clever phrases lined up to entreat you to click “play”. This is an honest, melancholy song about a universal experience that will be discussed in the history books of the future, guitars and synths centred around a heady electronic heartbeat, with a reverent Kurt Vonnegut reference (“loving echoes”) in the middle.
Keep your loved ones close x
CREDITS
Written, produced, performed and recorded by Laura Kidd at The Launchpad, Bristol. Mixed by Dan Austin. Mastered by Katie Tavini. Artwork by Alex Tillbrook, concept by Laura Kidd.
LYRICS
Remember the summer when everyone stayed at home? Ships in a bottle, stacked up with our lives on hold
If we could really see the warnings that were written before If we could really feel Our hearts would smash all over the floor
Hear me now, I can feel the thunder March me out with the fallen number Will there be – is there a black car waiting for me? Keep your loved ones close
This is surviving, but we’re having a god damn year Tired of climbing, but the universe left us here
And on my worst of days I want to keep wanting to be kind But everywhere I see machines are taking over our minds
Hear me now, I can feel the thunder March me out with the fallen number Will there be – is there a black car waiting for me? Keep your loved ones close
Keep your loved ones close Even on calm waters, waves will rise As my heart explodes Loving echoes dancing in my eyes
Keep your loved ones close Keep your loves ones close Keep your loved ones close
Hear me now, I can feel the thunder March me out with the fallen number Will there be – is there a black car waiting?
Hear me now, I can feel the thunder March me out with the fallen number Will there be – Is there a black car waiting for me?
+ New episodes of my music podcast “Attention Engineer” are released every Wednesday – visit this page to find out more and subscribe via your favourite podcast platform.
![“Why I’m still not playing gigs in 2021” [VIDEO]](https://penfriend.rocks/wp-content/uploads/2021/07/PFYT-002-Vlog-Thumb-no-text.jpg "“Why I’m still not playing gigs in 2021” [VIDEO]")
