VAT when renting a room from a VAT reg'd company

[newatnails]

Hi everyone,
I'm speaking to a very old friend at the moment who has a free beauty room in her hair salon waiting to be rented, she said the last beautician did it on a percentage of all her treatments (60% to her & 40% to hairdressers) using her own products (the beauty therapist's that is) what I wanted to ask, she said because they are a VAT registered company when a sale goes through the till they have to take off 20% 1st to the VAT man, so the 60/40% comes off the remaining balance.

But if I worked in the same way and agreed to the 60/40 split at first to see how things went, I am not vat registered, however I will be the one who has bought the products, so surely it shouldn't be done like I have detailed here, as I will be penalised when it should come off the hairdresser's portion surely if I'm providing the products ?

Anyone got any advice on this for me please ? x

 

[Baggybear]

To avoid them taking the 20% before the split you need to take all your own payments. You should be taking your own payments anyway as your self employed and you will need to be able to do your accounts.

Them taking payments for you will make it harder to do your books & for them to do theirs. Keep things simple and take your own payments.

Just make sure that your clients can see where to pay you so they don't get confused and think they can pay for your services at the salon till (& tell them NOT to take payments at their till, to direct the client to you for payment if anyone should ask to pay for your services at their till).

 

[newatnails]

Thanks for that Baggybear..., think I'm going to ask to rent the room on a daily basis now and do as you have suggested x