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Post Info TOPIC: Fundraising Company – How to handle and process charity money


Member

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Posts: 8
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Fundraising Company – How to handle and process charity money


Hello, we are a limited company which raises money for charity by selling our products with a portion of the sale price going to charity.
 
We have a contract with different charities which outlines that the money we raise is held in our bank account temporarily and later transferred to them.
 
We would like to make sure we are managing this as appropriate in our accounts and bookkeeping. This charity money that comes into our accounts should be exempt from VAT.
 
For example: We sell a product for £500.
£100 goes to charity.
£400 goes to our company.
In our book keeping, this is logged as £400 vatable, £100 vat exempt.
 
From a legal perspective and for easier management, would it be better to have two separate bank accounts (one for charity money, one for our money)?
 
Im not sure whether this just over complicates things unnecessarily because we take payments by card terminal and either way (based on example above) the £500 would be going into our bank account to then be separated later.
 
It would be great if we can have some professional advice on this and whether this setup would be required or are we just overcomplicating our bookkeeping by splitting the bank accounts and transferring funds across the two bank accounts?
 
It would also be good to know if there are any other legal requirements for us to be processing charity money in this way.


__________________


Master Book-keeper

Status: Offline
Posts: 8646
Date:

You have been told already, this is a forum for bookkeepers and Accountants, so we cannot answer your questions here.

So why do have you posted another two questions whilst completely ignoring the other posts.


Should it be VAT exempt though?!

__________________

 Joanne 

Winner of Bookkeeper of the Year 2015, 2016 & 2017 

Thoughts are my own/not to be regarded as official advice,which should be sought from a suitably qualified Accountant.

You should check out answers with reference to the legal position



Master Book-keeper

Status: Offline
Posts: 8646
Date:

Jpeterson85 wrote:
 
It would be great if we can have some professional advice on this 

 

As I said earlier - happily recommend a VAT advisor.  You need one.

Plus an Accountant - you need one of those as well (or instead of if they are proficient in VAT regulations)



__________________

 Joanne 

Winner of Bookkeeper of the Year 2015, 2016 & 2017 

Thoughts are my own/not to be regarded as official advice,which should be sought from a suitably qualified Accountant.

You should check out answers with reference to the legal position



Senior Member

Status: Offline
Posts: 359
Date:

They need someone. They are making a mess all round.

But would you really want to recommend them to someone when they dont even respond?



__________________

Caron



Master Book-keeper

Status: Offline
Posts: 8646
Date:

Agree.

Every post has got little researched scarily wrong information.

__________________

 Joanne 

Winner of Bookkeeper of the Year 2015, 2016 & 2017 

Thoughts are my own/not to be regarded as official advice,which should be sought from a suitably qualified Accountant.

You should check out answers with reference to the legal position

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