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Commission charged on Value Added Tax

Booking.com are applying unfair practices for partners who are registered vendors for Value Added tax. As a VAT registered vendor and accordance with the South African VAT laws invoices issued are inclusive of VAT at 15%. A partner is required to register for VAT if annual turnover exceeds R 1,000,000.  The VAT portion of the booking is not our money and we collect  it as agents of the revenue authorities. It you are on an 18% commission structure the net effect is that you are paying 20,6%. This puts you at a distinct disadvantage to non VAT registered partners.  As bigger businesses who generate more commission we should not be disadvantaged by their commission policies.

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8 Replies
46 Views

9
Sharonpowney

But as a VAT registered business you can also claim back VAT paid on goods and services purchased.  Whereas an unregistered business cannot.

+3
1 month ago
1
Wits End Mount…

You have missed the point. Yes I know that I can deduct the VAT charged on the commission but we are still charged commission on money that is not ours the VAT that belongs to the tax man. A simple example.

I have a booking for R 1,000

Vat payable 15/115 = R 130.00 ( this is not my money but I collect on behalf of taxman)

Commission on full R 1,000  at 18%  R 180.00 

+ Vat at 15 % on R 180.00            + nil   as I can claim it back

So I get R 1,000.00 - R 130.00 - R 180.00  = R 690.00

If I wasn't registered I would get.

Booking R 1,000

Vat payable NIL:

Booking.com commission  180.00

+ VAT  AT 15 %                  R27.00

So I get                               R 793.00

So as a vat vendor I get R 103.00  less which equates to a commission of 20,6%

THIS IS NOT FAIR AND EQUITABLE TREATMENT

 

 

 

 

 

 

 

1 month ago
1
Jureerat Intha…

Hi ,

Manny thanks for your sharing informations too !we will be keep updating and try more ways of business together then .

Have a nice day !

With warm regards ,

Bi- Bamboo Mountain House Team 

1 month ago
10
BrookAve

???

 

I think you have replied to the wrong post

1 month ago
1
Wits End Mount…

We need to work together. We as VAT vendors are paying VAT on the taxman's portion of the booking as well  .This equates to a 20,6% commission as opposed to 18%. 

1 month ago
1
Wits End Mount…

I have tried dealing with their credit controller. She keeps on harping on the fact that they have to charge VAT on their commission invoice so we can claim it back. Missing the point entirely. As VAT vendors our prices are inclusive of VAT. We are charged commission on the full amount including the vat portion. This is totally unfair as we in effect commission of 20,6%.

1 month ago
10
BrookAve

check it out with your local accountant or a local accountancy advise place

1 month ago