Do you offer prompt payment discounts? Ever thought that instead of giving a discount; you tell clients you will make a donation of the percentage normally given, to a charity in their name?
An accountant spoken to about this has said it’s possible to do, and it could a way for you to get paid on time; while at the same time showing your support for local causes.
Imagine you normally give a 10% discount to clients who make prompt payments, a bit like utility companies do. If your invoice is $1200.00, and you normally give a 10% discount, you’d be making a contribution to charity on behalf of that client of $120.
The other way this can be done, is to break the discount in two; give your client a 5% discount, and make a further 5% contribution of the total invoice amount to charity in your name. This way you’re able to claim the 5% as a tax rebate.
In the current up and down market we’re still seeing, it makes sense to look at other ways to encourage people to pay on time; so why not look at something like this as a way to help you and charity at the same time.
Selecting a charity or charities could be the hard part; but most people have an idea of the types of causes they support. A while ago I posted Not-for-profit – Giving Survey Results, this should give an idea on how to select a charity.
Imagine how the charity you give to would feel, seeing extra money coming in on a regular basis. Think how much more they could do with these extra dollars; and has it really cost you? It doesn’t if you normally give a discount.
Doing something like this can help with staff morale, ask your staff what charities they support, get staff buy in and you’re definitely on the road to a win – win – win situation.
What have you got to loose? Nothing, you can only win adopting something like this in your business.