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Tax on commission paid to 3rd party

Posted 9 March 2016

Sally says:
8 March 2016 at 19:50

We for example pay a 3rd party whom can either be a business or individual an incentive/commission to generate more business. So for example, if I go to a dealership and ask them that if they sell a car and they use our product with the car they sell, I will give them R200 per deal they do as an incentive/commission. So they are not employed by us. Do we need to tax them first? Or do they just need to send us an invoice or what is the correct process to follow? Thank you!

TaxTim TaxTim says:
9 March 2016 at 14:51

You do not need to deduct tax in this instance. They must send you an invoice.

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