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GemstoneCasey's avatar
GemstoneCasey
User
3 years ago
Solved

Director of two companies. How to record payments from one company to another

My director has two companies.  One company pays the other company for lawyer accounts.  Do I use an invoicing system for them?  How to record transactions in both companies so a record can be kept a...
  • Tracey_H's avatar
    Tracey_H
    3 years ago

    Hi GemstoneCasey 

     

    Thanks for your post. One way of dealing with this situation is to create a Company loan liability account in each company file. When Company A pays a bill for Company B you would record a Spend Money transaction with the Pay from account as the bank account and allocated to the Company B loan account.

     

    Then in Company B, record a Spend Money transaction with the Pay from account as the Company A loan account and allocated to the applicable expense account, for example lawyers fees. If you enter invoices through Purchases you would enter them as normal and when paying the bills change the Pay from account to the Company A loan account.

     

    If you're not sure if this method is suitable for your situation I would recommend checking with the accountant.

     

    Please let me know if you need further help.

     

    If my response has answered your enquiry please click "Accept as Solution" to assist other users find this information.

Tracey_H's avatar
Tracey_H
Former Staff
3 years ago

Hi GemstoneCasey 

 

Thanks for your post. One way of dealing with this situation is to create a Company loan liability account in each company file. When Company A pays a bill for Company B you would record a Spend Money transaction with the Pay from account as the bank account and allocated to the Company B loan account.

 

Then in Company B, record a Spend Money transaction with the Pay from account as the Company A loan account and allocated to the applicable expense account, for example lawyers fees. If you enter invoices through Purchases you would enter them as normal and when paying the bills change the Pay from account to the Company A loan account.

 

If you're not sure if this method is suitable for your situation I would recommend checking with the accountant.

 

Please let me know if you need further help.

 

If my response has answered your enquiry please click "Accept as Solution" to assist other users find this information.