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Affiliates & Tax


maniahost

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Just wanted to clarify that I'm thinking along the right lines here, in that when we pay an affiliate their % / £ commission tax is ignored? e.g...

 

Customer comes through affiliate link & buys product A

Total price is shown on site as £23.50 (which includes £3.50 VAT) per year

We have product set to pay affiliate fixed recurring amount of £10

Affiliate is paid £10 of the £20, ignoring the VAT element?

 

Is anyone able to confirm this, or correct me if I'm mistaken? Thanks in advance.

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  • 2 weeks later...

Hi,

 

Did you ever get an answer to this?

 

Nabil

 

Just wanted to clarify that I'm thinking along the right lines here, in that when we pay an affiliate their % / £ commission tax is ignored? e.g...

 

Customer comes through affiliate link & buys product A

Total price is shown on site as £23.50 (which includes £3.50 VAT) per year

We have product set to pay affiliate fixed recurring amount of £10

Affiliate is paid £10 of the £20, ignoring the VAT element?

 

Is anyone able to confirm this, or correct me if I'm mistaken? Thanks in advance.

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Thanks for your response Matt. If we have it set to tax exclusive, then is there any way of making the system show inc. prices beside it?

 

Eg. £10 (£11.75 inc. Tax)

 

Therefore customers see the fully inclusive price immediately and affiliates are paid correctly. Any ideas / suggestions anyone?

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Problem is that in the UK prices to consumers are inc VAT, while in the US they display ex Tax (VAT). The affiliate commission should be based on the ex VAT price otherwise you're paying commission on tax, obviously.

 

The only way I can see to get around it is to adjust the affiliate pay out rates accordingly but that will cause it's own problems as affiliates will see 9.1% instead of 10% everywhere for example.

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That won't be a problem as we're paying fixed rates anyway (i.e. £ rather than %) but one of our main priorities is clear, transparent pricing, so we don't want tax slapped on at the end of the transaction, it needs to show the VAT from the off. Any ideas?

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