Advice please - Commision-only sales for Non-EU services

muhandis

Hello,

My friend runs a web design company in India. I work in London and have delivered a few UK clients for him informally, but we would now like to take it up a notch and have me as a commission-only salesperson for his company. For every client that I deliver, I will get a certain percentage of the job.

I want to make sure that everything we do is entirely above board from a UK legal and tax perspective. I have a full-time job and will be working on this part-time, and from what I've seen, I expect sales of not more than 30-40k a year (paid directly by client to the company in India) and my commission as less than 5-6k a year (paid by the company in India to me in London by western union) .

I looked this up on the HMRC website but aren't sure that I understood it correctly. From what I understand -

1. I set myself up as a sole trader.
2. Register for self assessment.
3. Keep a record of the commission payments that I receive.
4. Keep a record of my work related expenses.
5. File self-assessment returns every year.

However, I have a few queries -
1. When the company invoices the client, will it have to include VAT as well (total UK sales will not be more than 30-40k a year)?
2. As a commission-based salesperson for the company, will I be legally liable for any problems related to the company's services in the future or will that be between the company and client directly?
3. Is there any way that I can register a UK presence for the company even though it isn't based here?

I'd appreciate it if some of the small business experts on the forum could help with this. At the outset, I thought this should be a breeze but it just seems to get more and more complicated the more I delve into the details!

Thanks,

Kala

Wywth

muhandis wrote: »

Hello,

My friend runs a web design company in India. I work in London and have delivered a few UK clients for him informally, but we would now like to take it up a notch and have me as a commission-only salesperson for his company. For every client that I deliver, I will get a certain percentage of the job.

I want to make sure that everything we do is entirely above board from a UK legal and tax perspective. I have a full-time job and will be working on this part-time, and from what I've seen, I expect sales of not more than 30-40k a year (paid directly by client to the company in India) and my commission as less than 5-6k a year (paid by the company in India to me in London by western union) .

I looked this up on the HMRC website but aren't sure that I understood it correctly. From what I understand -

1. I set myself up as a sole trader.
2. Register for self assessment.
3. Keep a record of the commission payments that I receive.
4. Keep a record of my work related expenses.
5. File self-assessment returns every year.

However, I have a few queries -
1. When the company invoices the client, will it have to include VAT as well (total UK sales will not be more than 30-40k a year)?
2. As a commission-based salesperson for the company, will I be legally liable for any problems related to the company's services in the future or will that be between the company and client directly?
3. Is there any way that I can register a UK presence for the company even though it isn't based here?

I'd appreciate it if some of the small business experts on the forum could help with this. At the outset, I thought this should be a breeze but it just seems to get more and more complicated the more I delve into the details!

Thanks,

Kala

In answer to your numbered questions:

1. You can only charge VAT if you are VAT registered. As your income is below the VAT registration threshold, I would suggest you don't register voluntaily and so avoid this complication.
2. If you are simply providing potential sales leads, then you will not be responsible to the end user for something they buy from the supplier. If you provide a service to a customer that you procure from another company, then you will be responsible.
Make sure you set up any contracts accordingly.
3. No, it's not your company anyway.

Wywth

Btw, are you not already registered as self employed (at least for some of your earnings) with HMRC?

https://forums.moneysavingexpert.com/discussion/3442273

If so, you don't need to register again.