Accounting for product sourcing + commission
MamboMouse
Registered Posts: 10 New contributor 🐸
My company are buying some items of furniture on behalf of a Client. We will be charging a 10% commission on top for sourcing the furniture. Having not done this before, I want to double-check what I think is the correct treatment. My brain is going in circles!
Do I treat the furniture as a disbursement (charge client Gross cost), and then charge the commission+VAT? Or charge client furniture net cost + commission fee, and then + VAT on the subtotal?
Thank you in advance for your help.
Do I treat the furniture as a disbursement (charge client Gross cost), and then charge the commission+VAT? Or charge client furniture net cost + commission fee, and then + VAT on the subtotal?
Thank you in advance for your help.
0
Comments
-
You can check the correct treatment here http://www.hmrc.gov.uk/vat/managing/charging/disbursements.htm
Hope that helps.0 -
Thank you so much for that link. That's exactly what I thought, but my boss disagreed with me so I started to doubt myself & needed back-up. At least I can direct him to HMRC when he tries to argue with me again (boss=architect, me=MAAT - who do you suppose is more likely to know how to treat it?!) Shuh!0
