I have received an invoice from a sales person for their commission payment which I will post accordingly. However they have asked that their payment be off set against a purchase that they will be making in the future. What do I do?
You cannot offset against something that has not yet happened unless there is a legal or constructive obligation for the purchase to proceed.
if the purchase had already happened and it was that payment was pending then that would be a different matter and would come down to your companies policy on offsetting.
Also, the only reason that I can see for the sales person to want to accept goods rather than payment is in an attempt to avoid tax on their commission by the money not appearing in their bank account which is of course illegal. (this would of course only be the case if the sales person was independant of your company).
General advice. No.
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Shaun
Responses are not meant as a substitute for professional advice. Answers are intended as outline only the advice of a qualified professional with access to all relevant information should be sought before acting on any response given.
The sales person is independant of the company. Maybe I need to be clearer and explain. The product has been purchased but upkeep is required and charged yearly on top of the purchase. So instead of me giving the money to them they wanted deducted off the invoice i will issue to them soon. Does that make sense? I still dont know what to do?
Assuming that the supplier supplies a proper invoice for their services ( a bona fide transaction) then the easiest way to do it is to create a "Contra" bank account.
Make the payment from it to pay the supplier account, and receive the same amount from the suppliers "customer" account.
If you are using Sage 50 Plus or above, and you are on standard VAT, you can use the Contra Entries tool in the tools option (You still need to create a "Contra" bank account)
Thanks Wella. The company I work for do my head in with weird clients and requests. In the future do you think I should just say no and we pay them and then they pay us for our services
In the future do you think I should just say no and we pay them and then they pay us for our services
