I'd like some help on a VAT issue if anyone can be kind enough to spare some time to help.
Where I work we've done one of those groupon-type promotions. We've received a nice big cheque at the end of it and I need to account for this correctly.
Let's say the commission rate is 30% (of gross revenue) and gross revenue is £100.
They have sent us a sales invoice that says their fee is £30, and VAT on this is £6, so we've banked £64. So far so good. But how do I account for the VAT?
My thought is that I should account for sales VAT as £100 x 1/6 = £16.67 and so have in the books:
Net sales £83.33
Commissions paid £30.00
then on the VAT return sales VAT of £16.67 and input VAT of £6.00
Does this sound correct?
Replies (3)
Please login or register to join the discussion.
I might be going off at a tangent here
But to my eye I need to ask: how does this all work? Have you sold £100 of vouchers to people (worth, I assume, over £100) and then had to pay the third party £30 for being allowed to do this? Or has the £100 come from elsewhere?
Vouchers are tricky things for VAT and I'd hate to mislead you.