paying commission

[MrJuice]

I have a chap who does work for my business very sporadically. I paid him £400 recently for some work via bank transfer from my business account. Some weeks later, something else came up and he did some work for me. I asked him for the invoice and he says 'sure, I'll send it but with my wife's account details, for tax reasons'.

I haven't asked but I get the impression his wife is a house wife without any income.

Am I at any risk at all by sending this payment to his wife? I'll have the invoice to show HMRC, if I ever needed to, that this money leaving my business account was a legitimate expense.

[Simpo Two]

All you've done is sent £400 (and offset it aginst your own profit we presume). It's up to him to account for it.

Where does commission come into it? You paid him for some work.

[MrJuice]

Simpo Two said:

All you've done is sent £400 (and offset it aginst your own profit we presume). It's up to him to account for it.

Where does commission come into it? You paid him for some work.

He basically arranged a sale for me. I had an agreement with him that should he find a buyer for my products, I pay him a commission. This has now happened twice.

So, it's fine that he did the work but his wife is getting paid?

[ModernAndy]

I'm not an expert but surely you have to pay the person or business who have provided the service. That is to say if it's his name but his wife's bank account then that's fine but if it's his wife's name and account you know thats not who provided the service and you could be on dodgy ground. They'll probably get away with it but I have a feeling they shouldn't be doing the latter from a legal perspective at least.

[Eric Mc]

For you to be able to claim this cost as a legitimate business cost you should be able to prove that you paid a person who had done relevant business related work for you.

The normal evidence for that, when using an outside third party (as opposed to an employee) would be a properly set out invoice showing -

a) the nature of the work done

b) the name of the person involved

c) their address

d) the date the work was invoiced

If the money ends up in that person's spouse's bank account is of no importance to you - but you should obtain the right paperwork from him. i.e his invoice.

[MrJuice]

thank you to everyone who posted