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Nick Skipp
February 13, 2023
Question

Invoicing for Auction Sales

  • February 13, 2023
  • 1 reply
  • 0 views

I am an art dealer and I normally do my sales by invoicing my customers with Vat added to the invoice and then record the payment as Sales Income.  However, I have recently consigned some of my stock to an auction house who have sold it for me in their salerooms.  I cannot raise an invoice for this as it is a consignment.

Please advice as to how to record this income which was the proceeds of the sale less the auction house fees.

 

Many thanks!

1 reply

paul72
paul72
February 13, 2023

Hi @Nick Skipp 

 

You have sold the items to the auction house, they have sold them to their customer(s) but taken a commission from you.

The auction house has probably done this on a Self-Bill basis but in QB you need to raise an Invoice for the items & enter a Bill for the Commission.

Receive the Payment against the Invoice & Contra the difference (balance of invoice against the commission).

 

Hope this helps.

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Nick SkippAuthor
February 14, 2023

Hi paul72,

Thank you and what you say makes sense but I'm still unsure about the Vat part of the billing.  The auction houses all use the Vat Margin Scheme so I can't claim theirs (ie. their commission and various fees) as input Vat; and also do I issue my invoice with no Vat on it? Or, if I do put Vat on it I would effectively be having to pay the 20% element of the income out to HMRC as Output Vat....

Just to complicate the Vat issue further, the auction house told me they have charged THEIR customer 20% Vat rate on the net amount they pay me (the hammer price).  I am effectively being paid income as a net of Vat figure.

Any thoughts?

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