VAT on sale of paintings created by local artist

[Galactus2024]

I am the accountant for a Community Benefit Society, which started trading in March this year.
We are a village shop created to provide the local area with a place to purchase food, drinks
and household goods. We are run by volunteers one of whom is an artist.
He is considering selling his paintings in the shop and giving the shop a commission. I have
checked everywhere for the VAT rate for the sale of original paintings but cannot find a definitive answer to my problem. I can find VAT rates for importing art, for selling and buying art at an auction, but cannot find any help regarding selling in the shop the local artists paintings. I should point out that the artist is NOT registered for VAT. I was going to propose that we display and sell the paintings through the shop and deduct the agreed commission paying the balance to the artist BUT cannot determine whether we need to charge VAT and if so what percentage?
The other option would I suppose be for the artist to sell the paintings direct when he is on duty in the shop which I am thinking should not include VAT as he is below the threshold and not VAT registered.
I would be extremely grateful if anyone can lead me in the right direction or at least help me to determine the VAT rate for the paintings.
Thank you in advance for any help you can give

 

[DontAsk]

All Google results I generated (rea ones, not just the AI summary, which does seem to agree) suggest VAT is chargeable on the commission amount.

 

[Galactus2024]

That is the logical answer but I could not find any HMRC VAT help that provided that solution which is why I decided to try the UK business forum for help.
Unfortunately there is nowhere on HMRC that enables contact with this sort of question.

 

[Scalloway]

I had to deal with this question a while ago for our local museum shop. I can't lay my hands on the HMRC page but bascially your shop should act as a disclosed agent for the painter, ie you should have a written agreement with the painter and a notice to that effect in the shop.

 

[Scalloway]

HMRC Manual

VTAXPER37500 - Agency and disbursements: how agents should account for VAT - Section 47 of the VAT Act 1994: contents - HMRC internal manual - GOV.UK

www.gov.uk

 

[Galactus2024]

I had to deal with this question a while ago for our local museum shop. I can't lay my hands on the HMRC page but bascially your shop should act as a disclosed agent for the painter, ie you should have a written agreement with the painter and a notice to that effect in the shop.

Hi Scalloway,
Thank you for your information. Following your comments does that mean that I am OK to
proceed to sell his paintings through the shop as a disclosed agent providing I follow your instructions and if so I pay 20% VAT on the commission earned by the shop?

 

[Scalloway]

Yes that is correct.

 

[Galactus2024]

Yes that is correct.

good morning Scalloway,
I now have a print(old fashioned) of the whole of section 47 of the VAT act 1994 and
am working my way through the nuances of handling the commission received for
VAT purposes.
I am so grateful for your help, although I have handled VAT for many years it never
ceases to amaze me how difficult it can be to obtain a definitive answer to a seemingly simple question. I have so far managed to fight my way through the VAT jungle and thanks to you and people like you have never failed to resolve any VAT related questions I have.
I sometimes wonder if the various VAT acts are purposely made as difficult as possible to make it easier for the Government, when conducting a VAT audit, to prove incorrect application of the various Acts!
If ever you need help with the accounting for Community Benefit Societies I am your man
Once again thank you so much.