Glossary
Finder’s Fee
A finder’s fee is a commission paid to an individual or company for introducing two parties who complete a business transaction, such as a sale, investment, or partnership. The finder is not involved in negotiating the deal—only in making the initial connection.
Who typically earns a finder’s fee?
Anyone who facilitates a business introduction—such as a consultant, intermediary, or even an individual with the right connections—may be eligible for a finder’s fee.
How is a finder’s fee calculated?
Fees can be a flat amount or a percentage of the deal value. Terms should be agreed upon in writing to avoid disputes.
Is a finder’s fee legally binding?
Yes, if there’s a written agreement. Without a contract, enforceability may vary depending on local laws and the nature of the arrangement.
What’s the difference between a finder and a broker?
A finder only introduces the parties, while a broker actively negotiates or facilitates the deal and may be subject to licensing requirements.
Are finder’s fees taxable?
Yes. Finder’s fees are considered income and must be reported to tax authorities by the person receiving the payment.
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