# Vat Exempt Commission



## mrman123 (5 Feb 2009)

A large part of my business income is commission for which we are vat exempt.

we do other work which we charge vat on and we but items that we pay vat on.

I would have thought that to calculate my vat bill i ignore commission income and offset the sales with the purchases and pay/clai the difference. Is this correct or is it calculated differently due to the revenue from commission?


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## Graham_07 (5 Feb 2009)

Are the other expenses on which you pay VAT expended SOLELY for the non-commission sales ? If so then you would be correct, if not then some apportionment must be made.


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## mrman123 (5 Feb 2009)

Thanks, i dont understand it all but ill let my accountant sort it out.


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## Graham_07 (5 Feb 2009)

Thats best but just to explain a bit more. Say you have a business which runs from one premises, insurance broker and auctioneer say. The insurance business is VAT exempt, the auctioneering business is VATable. There is one ESB bill, one phone bill, one accountants bill , computers bought all of which have VAT on but all of which are shared by the 2 parts of the business. You can't claim the VAT on all the bills against the VAT on the auctioneering sales. You have to arrive at an equitable apportionment as between the usage to each part of the business and claim the VAT on that portion of the expenses only that relates to the VATable sales.


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## EamonnOB (5 Nov 2009)

Hi, If I receive a commission as a sales agent for selling clothing, is that vatable?


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