Hopefully, someone will be able to clarify something that has been niggling us for a while.
We generally take our own bookings for gigs, but occasionally get some work from an agency that takes 15%.
So say we get a gig that pays £850. We get £722.50 (85%) and they get £127.50 (15%), right?
WRONG!
According to them, they get 15% plus VAT which they calculate to be £153, leaving us £697.
It seems to me that we are paying their VAT bill for them, which seems crazy. Can that be right?
If this is one of those industry standard pitfalls to screw over musicians (like 'breakages' etc.) aand I am to naive to know about it then fair enough I suppose, but does anyone else have experience of these terms?
Comments
^^^this.
At work, when speaking to a retail customer we always include VAT in the quoted price, speaking to a trade customer it's always excluding VAT.
IIRC there's very little which doesn't have VAT put on it. Books are one of the few things I can think of.
Ringleader of the Cambridge cartel, pedal champ and king of the dirt boxes (down to 21)
Bandcamp
Spotify, Apple et al
In your case just make sure you have a VAT invoice/receipt with the agents VAT registration number clearly printed on it. I know of at least one agent that charged VAT but was not registered at the time! They received a visit from the grey suits and it cost them a pretty penny.
Is it a large agency with many acts or a bloke called Terry who organises the turns for two local pubs ?
This is standard among all agencies that are big enough to be VAT registered. It normally states 15% +VAT on the contract. Your not buying the gig, but paying the agent for their services in arranging the gig.
If you are VAT registered too, surely it isn't affecting you at all is it?