Forum Categories › GENERAL VAT DISCUSSIONS › Handling commission payments for VAT exempt vendors › Reply To: Handling commission payments for VAT exempt vendors
That was very kind of you to write such a detailed response, I very much appreciate that – particularly during the holidays. Thank you.
Reading your reply made me realise I should have said Client in place of Partners. There’s no formal contract as such, just an agreement made by email on a show to show basis. As we are the point of sale for the entire transaction and they invoice for their respective share of those sales I think Option 2 applies, sadly.
How it usually works with other clients is that we work on the basis that we absorb our own respective shares of VAT. So for example if they get £10 for the sale, they invoice £8.33 + 1.67 VAT per ticket , so that we only absorb VAT on our share (even though we collect it on the entire transaction as the point of sale). As they are VAT exempt, their expectation is that they will receive the full £10 and that’s the crux of the matter
Your response has been most helpful and far clearer than my Accountants. you don’t do accounts do you, haha (joke).
All best for 2023 and thank you again.