Tax matters!

Perth 12th January 2012

The other issue that was bothering me yesterday was about tax… I guess when you work generally within one country it is pretty straight forward, your fees are inclusive or exclusive tax (in most countries GST or VAT) and that’s it. You know where you stand. But working cross border in other countries, like we do, brings a host of new challenges along. Till recently it was actually not too complicated. Our fees are generally net, in other words we invoice $10,000 we expect to be paid $10,000 minus some minor bank charges on our side as the banks always happily claim. But more or less we get the fees without any deduction. For that we have tax residency certificate in place that states that we pay our taxes in Singapore (or Australia) and that therefore as a result of double taxation agreements between countries there is no need to withhold any taxes on the fees in the country of payment origin.

I am not a taxation expert but so far this has worked well for us, with the taxes being deducted at our end when we do our annual income declarations. But recently (please let me know if you are experiencing similar situations), countries like China, India and Indonesia for instance, are requesting the taxes to be deduced at source, then providing us with a taxation certificate so we can use that to claim the tax back or reduce our tax dues. The result is that we are caught out short up to 20% at times in the receivable fees. Not happy Jan…

This has now happened a few times over the last few months and we have yet to find out how and if at all we can claim it back properly. In one of our projects in China the client agreed to increase our fees with the tax percentage so we would still receive our due fees net as per agreed contract. Something to watch as these kind of taxes can greatly affect the cash flow of small lighting design practices like ours!

Light & Learn 3-1 : So here we go with the first Light & Learn…Now this is very basic, but you would be surprised how many people (lighting salesmen for instance!) don’t know the difference between a lux and a lumen, one of the basic units in lighting. I was ever shown it in a very simple way which I have sketched below J
The basic units are:
Lumens, amount of light emitted in all directions; also commonly called light output
Candela, light in one specific direction; also commonly called lighting intensity
Lux (Lumens per m2), amount of light falling on a surface; also commonly called illuminance/ lighting level
Candela’s per m2, reflected light perceived by the eye; also commonly called luminance or brightness

 

12. January 2012 by Martin Klaasen
Categories: Light & Learn, lighting and the economy, lighting design practice | 1 comment

One Comment

  1. lux =lm/m2
    If i have a lamp >> the light meter red 340 lux distance 1m

    lm = 2(3.14)*(1)*(1)*(340) =6.28*340=2135.2 lm
    is it right

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