How do I record reselling services to a client?

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Hi,

I sell a service to my clients who pay for the month in advance. I then pay for the service provided for the month in advance, but on a separate date.

When do I record these transactions to the income and expense accounts?

For example, a client pays me £10 on 15/01/2020 for the month 15/02/2020 to 14/02/2020. I then pay the supplier £5 for the service for the month 05/02/2020 to 04/03/2020 on 05/02/2020.

Should I record this to the income and expense accounts on 15/01/2020 or 14/02/2020? Is it worth accruing this or should I just record them when the transactions happen, seeing as I am not responsible for providing the service?

Many thanks,

Ewan

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By WhichTyler
12th Jan 2020 15:47

Quote:

I am not responsible for providing the service?

Your client may disagree, seeing as they have a contract with you, not your subcontractor...

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