I do the bookkeeping for an orchestra, and I have a question about VAT dissagregation I'm hoping someone might be able to advise on please.
The orchestra has some work next year, which are being funded by the conductor. The orchestra is VAT registered, but the conductor is not.
Usually in this situation, the orchestra would pay all suppliers (musicians, rehearsal, concert, recording venues etc.), and then charge this plus a mark up to whoever is hiring the orchestra. The musicians are all freelancers by the way.
To save VAT, the conductor would like to pay all suppliers themselves (the suppliers would invoice the conductor in this case).
My only concern is, would there be any danger of us falling foul to VAT dissagregation? I'm wondering if we share a couple of financial links - common business profit plus financial dependency on one another.
Do you think my concern is valid? I'm thinking, one could argue that the conductor is putting on the concert herself (her name will be on the adverts as well as the orchestra), so it wouldn't be out of the ordinary for her to pay suppliers direct, would it?
Same answer I gave on UKBF (DWS)
Not disaggregation, happens all the time in the building trade, home owner wants to save VAT charged by the Contractor on the whole project so pays the sub-contractors themselves, nothing wrong with this at all
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Doug
These are only my opinions of how I see things and therefore should not be taken as advice
