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For EU Members - How Do I Claim This As Business Expense??

Discussion in 'Business & Tax Advice' started by socialmediapro, Mar 25, 2015.

  1. socialmediapro

    socialmediapro Jr. VIP Jr. VIP UnGagged Attendee

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    Hello,

    so I had a conversation with my CPA and she told me that Paypal Payment confirmations are not enough and don't count as much as an actual incvoice (at least here in the EU)

    So basically that would mean if I just made a paypal payment to someone (fiverr or some freelance workers for example) then I could not deduct this amount from my revenue.

    Wanted to ask you guys how you deal with that? Since you probably know fiverr for example doesn't even write invoices to it's clients.

    Was pretty shocked cause I always thought that a paypal invoice/payment with a good description is enough to claim it as a business expense.

    Thanks for the help!
     
  2. nobodyelsein

    nobodyelsein Regular Member

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    That's odd. I've been cheerfully using PayPal, and having PayPal integrated into my accounts since PayPal launched. Surely your account should just treat PayPal as an additional bank account?
     
  3. RosuC

    RosuC Regular Member

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    Your CPA is 100% right. If you don't present an invoice regarding the expenses/payments that you made from your PayPal account directly or from Bank Account/Credit/Debit Card through PayPal platform if you don't get an invoice you may not be able to have that expenses covered.
    It happened to me as well and I've learned my lesson, if I pay something on PayPal and I know that is for the company I ask for invoice, any PayPal user (full verified) can release you an invoice through PayPal System.
     
  4. lord1027

    lord1027 Elite Member

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    I am just posting here because I want to know how to do this as well :D My first guess is that it's not possible, but if there's a solution I'd love to hear it.
     
  5. socialmediapro

    socialmediapro Jr. VIP Jr. VIP UnGagged Attendee

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    so what do you show them as a proof of payment? Just the paypal receipt that you get send from paypal after you bought something? And are you in the EU? Cause I heard in the US you can actually do this.
     
  6. RosuC

    RosuC Regular Member

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    Don't mix the EU with USA. In USA you have to provide more information for autheticate the PayPal account and more than that their fiscal department are allowed to check the PP transactions. In EU is not allowed for German\Spanish Fiscal Deparment to request to PayPal Luxembourg anything because there is no legislation available. So don't mix the things :)
     
  7. nobodyelsein

    nobodyelsein Regular Member

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    I'm in England. I show them an invoice when I can, and sometimes a pdf of the transaction details page when I can't.
     
  8. socialmediapro

    socialmediapro Jr. VIP Jr. VIP UnGagged Attendee

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    Is this works without any problems?
     
  9. nobodyelsein

    nobodyelsein Regular Member

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    I personally have have never had any problems. To be clear though, what do you mean by your 'CPA'?
     
    Last edited: Mar 26, 2015
  10. socialmediapro

    socialmediapro Jr. VIP Jr. VIP UnGagged Attendee

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    I mean my bookkeeper. The person who will do my taxes and everything.
     
  11. eveneven

    eveneven Regular Member

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    Your CPA is right. You need an actual invoice, not just a Paypal screen dump. Most providers will give you an invoice, i.e. when I pay my hosting to Power Up Hosting, I pay via PayPal, but they also issue an invoice in addition to this.

    The same goes for providers here in BSTs, they need to issue you an invoice.

    In Spain you have to be a business to invoice. Most people on Fiverr aren't.
     
    Last edited: Mar 26, 2015