That TRS jack next to the HDMI port (It’s not a headphone jack, because it’s line-level audio, not headphone-amplified) functions as either an audio breakout for AV1 (as shipped) or an audio input for AV2 (by flipping the switch next to it; you’ll need a small, dull knife or a paperclip).
I don’t see anything in the manual about it, but it sounds like having a cable inserted into the AV1 audio breakout jack prevents that audio from being sent over HDMI. If that’s the case, I would leave the breakout unplugged and reevaluate your TV and audio setup.
Why use the audio breakout to run audio in the first place, rather than keeping it on HDMI? What speaker system are you using, and how does it relate/how is it connected to your TV and PC?