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Being billed by a small business & not sure what I'm being asked

LavaLamp006
Posts: 2 Newbie

Hi, I do apologise if this isn't the right place for this question, but I'm not sure exactly wha the situation falls under......basically, I'm starting with a coach this year and we agreed a rate per hour. They've just said that, as they're VAT registered, they want to find a way round so that I don't pay more than we agreed, so would it be alright if they billed me through their husband's business instead.
I'm not self-employed so I have absolutely no idea how this stuff works - obviously not paying more would be great, but I don't want to be unintentionally fraudulent or tax dodging if that's what this is? Is it usual/legal (for them or me!) to pay one business for a service you're getting from a different one? Please could somebody do an ELI5 to help me understand what this means and make a decision?
Thanks very much for any insights! And could I please politely request no lectures on the unregulated nature of the coaching sector and so on - I'm well aware of all that & I'm content with this person's quality of work having seen it with other people.
I'm not self-employed so I have absolutely no idea how this stuff works - obviously not paying more would be great, but I don't want to be unintentionally fraudulent or tax dodging if that's what this is? Is it usual/legal (for them or me!) to pay one business for a service you're getting from a different one? Please could somebody do an ELI5 to help me understand what this means and make a decision?
Thanks very much for any insights! And could I please politely request no lectures on the unregulated nature of the coaching sector and so on - I'm well aware of all that & I'm content with this person's quality of work having seen it with other people.
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Comments
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Presumably you husband's business is VAT registered?
Are you an employee of his business? Would the coaching in any way enhance your ability to do the job you do for his business?
Companies buy services off other companies all the time and thats clearly not a problem however the service must be of benefit to the company buying it for it to be a legitimate expense and similarly there are rules about benefit around their ability to reclaim the VAT on it.0 -
DullGreyGuy said:Presumably you husband's business is VAT registered?
Are you an employee of his business? Would the coaching in any way enhance your ability to do the job you do for his business?0 -
Tell them you would rather receive your invoices from the entity (business/person) that is providing your coaching just in case you ever need to evidence the spend in future. Really you want the invoice from them in case they attempt to screw you over so you have the right company details to chase them legally should you need to.
If they truly want you to pay only what you have agreed, then they can simply reduce the unit rate they charge so that when the VAT is added on top the total matches what was agreed. e.g if you had agreed £90 per session, then they need to charge the sessions at £75.00 (£90/120) then when they add VAT on of £15 (£75*20%) the total will be what you agreed £90 (£75+£15)
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I'd stay well clear. If they are happy to evade tax what else are they up to?0
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It's extremely dodgy in more ways than one. If they are VAT registered then they should charge VAT.0
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FlorayG said:DullGreyGuy said:Presumably you husband's business is VAT registered?
Are you an employee of his business? Would the coaching in any way enhance your ability to do the job you do for his business?
They arent trying to evade paying the VAT they are coming up with "creative" ways that the OP pays the same and they receive the same on a net basis now that they are VAT registered0 -
DullGreyGuy said:FlorayG said:DullGreyGuy said:Presumably you husband's business is VAT registered?
Are you an employee of his business? Would the coaching in any way enhance your ability to do the job you do for his business?
They arent trying to evade paying the VAT they are coming up with "creative" ways that the OP pays the same and they receive the same on a net basis now that they are VAT registered1 -
FlorayG said:DullGreyGuy said:FlorayG said:DullGreyGuy said:Presumably you husband's business is VAT registered?
Are you an employee of his business? Would the coaching in any way enhance your ability to do the job you do for his business?
They arent trying to evade paying the VAT they are coming up with "creative" ways that the OP pays the same and they receive the same on a net basis now that they are VAT registered0 -
Lol, thank you everyone, just for clarification - I have no husband, the coach is saying she'll bill me via her husband's business rather than her own.
From the replies so far, this does sound like some sort of tax dodge that is, at least, unethical if not illegal?0 -
LavaLamp006 said:
From the replies so far, this does sound like some sort of tax dodge that is, at least, unethical if not illegal?0
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