A potential client is a self employed aesthetics practitioner (eg giving people fuller lips). She works under the umbrella of a business that supplies all her work. They invoice the end client. IR35 aside (that will be a separate discussion) I just need a bit of advice on the following. The lady paid for her own training (not claimable) and pays her own insurances but both are being refunded on the invoices.
A typical invoice would show Work carried out £300
less products used £190 (supplied by the business)
Balance due £110
The lady gets 40% of that which is £44 and also receives 5% towards the initial training, with the balance due at the bottom of the invoice, and 5% towards the insurances, so the lady ends up with £55
For accounting purposes am I right in thinking that its £110 income on this particular invoice and £55 commission, or is it more complicated than that? Obviously the insurances would be treated as a further business expense as they occur.
-- Edited by Leger on Monday 27th of March 2017 08:47:47 PM
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John
Any advice given is for general guidance and professional advice should be sought applicable to your circumstances.
I have never had a client working through an umbrella business but it might be worth checking to see if there is a contract between both parties, apart from that everything you have said makes perfect sense to me and is certainly the way I would deal with this invoice within the accounts.
Cheers.
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Doug
These are only my opinions of how I see things and therefore should not be taken as advice
Its hard to explain. Company offers aesthetic treatments. It has 4 consultants? who provide these treatments on behalf of the company and the company bill the end client. The company then issues (presumably a self bill) invoice which details as described in my opening post. As far as I'm aware the company supplies the products used (botox for example)
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John
Any advice given is for general guidance and professional advice should be sought applicable to your circumstances.
Ah right. So they do it all, apart from the actual Botox injections bit, then they wheel in her to do that bit. So she is clearly employed then as you say IR35 alarm bells ringing all over the place.
I take it she doesn't have any stocks of product at all? So just gets billed for whatever she uses on one client? Who pays for disposal of product/needles/rent of space/uniforms and the rest?
Just to check-is there vat in the mix?
Any chance I can see an invoice, with the usual bits scrubbed?
Is the limited company claiming to act as an agency or such? Just wondering how they describe themselves.
Sounds like a can of worms.
Oh btw news on the grapevines....much afoot with ramping up ir35! Likely to affect one man band accountants. Can't say more at mo.
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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
Oh btw news on the grapevines....much afoot with ramping up ir35! Likely to affect one man band accountants. Can't say more at mo.
Hey Joanne,
When you've a spare five minutes could you explain further please? I've not heard of this myself so I'm very interested to know if HMRC are inline for my daughters inheritance....
I'm off to, as per another thread, buy myself some crayons, brushes and paints to then tour Europe - sounds like a plan! :)
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Johnny - Owner of an overly-active keyboard.
A man who can read, yet doesn't, is in no way wiser than a man who can't.
All good points and I'll ask her for further details. Many thanks
Edit:
On the disguised employment front, who's liable? I always thought it was the "employer", but I remember having a discussion with Shaun a year or so ago and he was of the impression it was the "employee".
-- Edited by Leger on Wednesday 29th of March 2017 11:49:36 AM
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John
Any advice given is for general guidance and professional advice should be sought applicable to your circumstances.
