2. Trade Euros are credited to the member’s Bartercard account upon the sale of goods and services through the exchange.

3. Members use their Bartercard transaction card to spend their credit balance, or draw on their interest-free line of credit, on goods and services from any other Bartercard member. Trading within the Bartercard system includes a number of transaction methods, such as electronic transactions via the internet, EFTPOS swipe card facilities, telephone, e-Commerce or by traditional transaction voucher.

In essence…
Bartercard is a strategic business tool that acts as a third party record keeper for global business-to-business trading. It facilitates and monitors all purchases (debits) and sales (credits) undertaken by its members. Bartercard’s credit/debit system functions in the same way the MasterCard and Visa systems deliver service to cash-paying consumers. No other trade exchange in the world can boast such advanced technological capabilities, trade facilitation or success.

A restaurant wishes to "barter" for T€10,000 worth of printing using meals and drinks. No printer would ever want T€10,000 in meals from the one restaurant, however by selecting a Bartercard printer, the restaurateur pays the printer with T€10,000 Trade Euros. The printer’s account is "credited" and the restaurateur’s account "debited", so the restaurant now owes T€10,000 in meals to the Bartercard network, NOT the printer. This is repaid as various Bartercard members come to the restaurant (new business) over the following months. Hence, the restaurant has paid for its printing requirements with meals, using an interest-free "line of credit" and at a cost of approximately 30 - 40 cents in the euro, in replacement good cost.

The printer can now use the Trade Euros earned to buy office furniture, advertising, car repairs, stationery, courier services, colour separations, accounting and legal services ~ even a family holiday. These are all commodities for which the printer would normally pay cash. By using their Bartercard Trade Euros, the printer conserves his cash and benefits from the extra business.

TAXATION AND BARTERCARD

Members should treat a Trade Unit as they would a Cash Unit from a tax perspective. Barter transactions are assessable and deductible for income tax purposes to the same extent as other cash or credit transactions. Therefore, the advantages and disadvantages are similar to ordinary cash revenue or expenses.

Trading may result in tax liability when selling and attract tax credit when purchasing. It may also involve the Fringe Benefits, Sales Tax and Capital Gains Legislation.

When an entity that is a member of a trade exchange makes a taxable supply to another member, there is the same liability for tax as if it were a cash transaction.

For the purposes of the tax laws, payments including income tax and the superannuation guarantee levy must be remitted to the Taxation Office in local cash currency.

Trading is not designed to be used as a means of tax evasion or avoidance. Bartercard members should treat sales and deductible purchases as they would treat a cash transaction. Opening a Trade account is similar to opening another bank or credit card account.

As the third party record keeper, Bartercard Ltd has a legal obligation to provide information, upon request, concerning members' trading activity to any government department.
 

ACCOUNTING AND BARTERCARD

Bartercard recommends that you obtain advice from an accountant experienced in the record keeping and taxation accounting of Barter income, expenses and tax related issues. Bartercard has a network of accountants within the membership base that are highly experienced in providing advice on Barter, Taxation and Accounting of which you can pay for their services using the Bartercard currency.

TAX

If your business is registered for Tax, the supplies you make may be taxable or, in very limited circumstances, Tax-free or input taxed. It is important that you understand the difference between each type of sale and account for it correctly in your records. This can be done by setting up specific columns in a manual cash book or specific account codes in an electronic accounting package.

You are entitled to claim an input tax credit for the TAX you pay on your barter expenses, provided you hold a valid tax invoice. However, you should keep records that support all claims for input tax credits.

Cash and non-cash accounting

If you use the cash basis to report your income, you will account for your income when you receive payment and, similarly, you account for your expenses when they are paid. You receive or make a payment in a barter transaction when the recipient of the supply signs the docket or transaction slip to authorise the exchange of credit between the supplier’s and the recipient’s barter account.

If you use the non-cash basis, you will account for your supplies when you have issued a tax invoice or when any of the payment is received, whichever is the earlier. Similarly, you will account for any purchases when you receive an invoice for the purchase or when you have provided any of the payment for the purchase, whichever is the earlier.

Generally, businesses that have barter transactions will also have other transactions involving the exchange of money. The main method used to record income from barter transactions is to include them separately in a cash receipts book.