I have a yoga client that has given free classes to volunteers that have helped with some admin. The volunteers are not running a business so I believe she should not need to account for this as she would when she gave classes to another individual who bartered his marketing services and accounted for this is his own accounts as well. Am I right? I have a small worry in the back of my mind that perhaps the NMW issue will affect things. Has anyone else come across this issue before?
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If either party is registered for VAT, then the transaction involves supply and consideration for both.
For income tax purposes if a value was put on the service provided (the normal selling price of a class) then arguably that value should be brought into account as income but at the same time an equal deduction could be claimed for the value of the admin services bought in exchange so there is no effect on profit