I have a client who is in the Recruit to Recruit Industry. If someone refers a client to her then she will make a gift to the person making the referral. Eg of gifts can be spa days; night in a hotel; make up - most of the items can cost £100+ In fact her website states ''We offer £250.00 for the introduction of candidates with 6months + industry experience, alternatively a choice of fun packed activities from our Red Letter Day options''
1) Which Nominal code should I put them too? Can they be classed as a 'commission' / direct costs
2) Can I claim the VAT back on any invoices
3) Are they 'allowable expenses' for the Corporation Tax computation?
Also - she sometimes entertains clients at eg a spa day as an inducement (expensive I know!!). In this scenario - same three questions please
Hope someone can help
Chesh
__________________
Joanne
Winner of Bookkeeper of the Year 2015, 2016 & 2017
Thoughts are my own/not to be regarded as official advice,which should be sought from a suitably qualified Accountant.
You should check out answers with reference to the legal position
Spa days with clients - Entertaining, T9, NOOOOOO.
I would be encouraging her to document the attendees of these days, either on the invoice, or in a diary. HMRC entertaining investigations are pretty in depth!
I am not sure about the sales commissions, but I would be interested to know the answer. I would usually T9 cash/cheque payments to direct costs, assuming it was some random who didnt issue an invoice... but have never come across this gifting system before.
