Tip commission
TIP COMMISSION
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TIPPER COMMISSION The tipster commission pays tipsters who inform brokers about planned property sales by third parties. If a sale is made based on the tip, the tipster usually receives a share of the broker's commission. TIPPER COMMISSION - WHAT IS IT? In order to win new sales orders, many brokers seek advice from private individuals. In the event of success, these are rewarded by what is known as the tipster commission. The tipster's commission usually corresponds to a percentage of the broker's commission. Example: You notice that your neighbors want to sell your house and contact a realtor with your inside information. The realtor will contact your neighbors to sell the house for you. If it comes to the order and subsequent sale of the property, you will receive a commission as a tipster. AMOUNT OF THE TIPPER COMMISSION FOR SALE OF PROPERTY The amount of the tipster commission varies depending on the broker office. In most cases, the broker's fee is used as the basis for their calculation. So you get between 5 and 10 percent of what the broker earns on the sale. Example: On the basis of your tip, a realtor sells a house for 200,000 euros. The broker receives a brokerage fee of around 5.95 percent, i.e. 11,900 euros. From this brokerage you will in turn receive 10 percent, which means your tipster commission is 1,190 euros. THERE ARE NO LEGAL REGULATIONS However, there is no uniform statutory regulation for the exact amount of the tipster commission. While the broker's commission is subject to statutory regulations, the amount of the tipster's commission remains a matter of interpretation. As a tipster, you must therefore determine the amount of your commission in advance with the broker and contract it. TAX OBLIGATION OF THE TIPPER'S COMMISSION Whether the tipster has to pay tax on his portion of the commission depends on how high his received commissions are per year. As long as it is less than 256 euros a year, the commission is tax-free. However, if they reach a higher amount, the tipster has to tax his commissions as other services. In addition, it must be differentiated whether it is an occasional activity or whether it goes beyond that. If the latter is the case, the commissions are subject to VAT, as they are operating income from a commercial activity.
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