Vending machine paying commission to a venue

[VendUK]

Hi guys, relatively simple one i think, just need an answer on how I pay a venue I have a vending machine in.

scenario is, I pay 20% commission on turnover to the venue, the venue has zero involvement in collecting payments.

this is how it was being done:
the machine has nayax, we get paid directly, we then give a report and breakdown on the turnover to the venue as a credit note and pay them what is owed.

now our accountant has said, the venue has to invoice us for us to pay, and said we can create the invoice on their behalf (not sure if this is just for accounting purposes to give us a receipt).

Why can't i just give them a "credit note" (or call it something else if need be) why do they have to invoice me? especially as they don't get any figures until i send them to the venue?

now we have also just gone VAT registered, is it ok to show the breakdown like this?

Commission Details:
Commission Percentage: 20%
Total Sales inc VAT: £5000.00

Commission Due excluding VAT: £1000.00
VAT @ 20%: £200.00
Total Amount Due: £1200.00

thanks alot for any help

 

[StevensOnln1]

Issuing a credit note would imply that you are refunding them for something, rather than paying them commission. Both you and the venue will also need to pay/account for VAT correctly on the transaction.

If the venue are happy with the arrangement, you could issue a self billing invoice and send them a copy when you pay them the commission.

 

[numbersrule]

Hi VendUK
You have stated your Sales including VAT.
Are you sure the commission of 20% is on the Gross Amount?
It seems to me that commission should be 20% of the Net figure of £4,166.67 = £833.33 + VAT = £1,000.

 

[MyAccountantOnline]

Hi guys, relatively simple one i think, just need an answer on how I pay a venue I have a vending machine in.

scenario is, I pay 20% commission on turnover to the venue, the venue has zero involvement in collecting payments.

this is how it was being done:
the machine has nayax, we get paid directly, we then give a report and breakdown on the turnover to the venue as a credit note and pay them what is owed.

now our accountant has said, the venue has to invoice us for us to pay, and said we can create the invoice on their behalf (not sure if this is just for accounting purposes to give us a receipt).

Why can't i just give them a "credit note" (or call it something else if need be) why do they have to invoice me? especially as they don't get any figures until i send them to the venue?

now we have also just gone VAT registered, is it ok to show the breakdown like this?

Commission Details:
Commission Percentage: 20%
Total Sales inc VAT: £5000.00

Commission Due excluding VAT: £1000.00
VAT @ 20%: £200.00
Total Amount Due: £1200.00

thanks alot for any help

It's not a credit note you issue but generally a self billing invoice. Ask your accountant to explain it. You can also read about self billing invoices here https://www.gov.uk/guidance/vat-self-billing-arrangements

 

[Newchodge]

Hi guys, relatively simple one i think, just need an answer on how I pay a venue I have a vending machine in.

scenario is, I pay 20% commission on turnover to the venue, the venue has zero involvement in collecting payments.

this is how it was being done:
the machine has nayax, we get paid directly, we then give a report and breakdown on the turnover to the venue as a credit note and pay them what is owed.

now our accountant has said, the venue has to invoice us for us to pay, and said we can create the invoice on their behalf (not sure if this is just for accounting purposes to give us a receipt).

Why can't i just give them a "credit note" (or call it something else if need be) why do they have to invoice me? especially as they don't get any figures until i send them to the venue?

now we have also just gone VAT registered, is it ok to show the breakdown like this?

Commission Details:
Commission Percentage: 20%
Total Sales inc VAT: £5000.00

Commission Due excluding VAT: £1000.00
VAT @ 20%: £200.00
Total Amount Due: £1200.00

thanks alot for any help

Why do you pay an accountant and then ignore their advice in favour of the advice of a forum full of strangers? If you don't agree with the accountant, ask them to explain. If you don't understand the explanation tell them and ask them to be clearer.