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  • #991100
    TehCamel
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    I’m considering offering a referral scheme of sorts where if a current client refers someone and it works out, they get an amount off their invoice.

    I’m trying to work out how to record this for book keeping purposes.

    I was thinking along the lines of issuing an invoice as usual (So, add their services at say $500 ex GST)
    Then, adding a Payment onto the invoice straight away from “Expense:Marketing” in the amount of their referral credit.

    Customer then gets an invoice for the full amount, but only pays the smaller amount.
    I get an invoice at the full amount but also the expense int he expense column.

    Is this a bad/wrong idea, is there a better way to acheive?

    thanks!

    #1180016
    Gizmo
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    Hello,

    I run referral systems too.
    We keep it clean, and actually send the money owed as a payment to their bank nominated bank account.

    If you are going to deduct it as you are looking to do it I would do it as a voucher type system.

    #1180017
    ThexArm
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    You are better off paying a referral fees. So that everything looks clean in your books. By tinkering with your invoice, you are complicating your books.

    Just add the referrer as a supplier and raise a payment using the marketing expenses account.

    #1180018
    TehCamel
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    ThexArm, post: 209868 wrote:
    You are better off paying a referral fees. So that everything looks clean in your books. By tinkering with your invoice, you are complicating your books.

    Just add the referrer as a supplier and raise a payment using the marketing expenses account.

    Thanks, you mean in the same manner as Gizmo above?

    So, raise payment to supplier, pay it from Expense:Marketing, then physically pay it to their bank account ?

    #1180019
    ThexArm
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    TehCamel, post: 210081 wrote:
    Thanks, you mean in the same manner as Gizmo above?

    So, raise payment to supplier, pay it from Expense:Marketing, then physically pay it to their bank account ?

    That is correct.

    #1180020
    TehCamel
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    I have one final question on this:

    Where does GST fit into this, if at all.

    Ie, if I’m making a payment to an individual who isn’t GST registered, what would I do?
    What about if it’s a business who is GST registered?

    #1180021
    Gizmo
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    Hello,

    If you think about GST as a tax applied to good and services provided by businesses and collected by the business for the goverment it may help clear it up.

    So if you are not GST registered, you cannot charge and collect that tax.

    So a business who is not registered cannot charge you GST.

    Only a business who is registered can charge you GST.

    #1180022
    Brad Turville
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    TehCamel, post: 211133 wrote:
    I have one final question on this:

    Where does GST fit into this, if at all.

    Ie, if I’m making a payment to an individual who isn’t GST registered, what would I do?
    What about if it’s a business who is GST registered?

    Hey Andy,

    Because you are registered for GST then all of your invoices should include GST. Doesn’t matter whether the other party is registered or not.

    #1180023
    ThexArm
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    Andy is planning to PAY referral fees to his customers who referred other customers to him. That transaction doesn’t involve him issuing an Invoice.

    Sent from my iPhone using Tapatalk

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