Receiving and paying invoices for another company

[blockchain4ever]

Does anyone know the legal implications of receiving money and paying for an invoice for company B through the bank account of company A?
Company B has lost its bank accounts and was in need of doing a trade. Company A did a deal with this company to represent them in this 100% legit deal.
What the deal says is that company A buys invoices to/from company B for, say 98% of par value.

Is there an accounting/tax risk in this? What is typically required in a contract to legally deduct an invoice issued to another company? Financing companies do this all the time, so it must be doable, but is there anything that must be in such a contract to make it work?

 

[Sols]

Yes, this can create massive accounting headaches, especially if you're ever audited.

Companies that do it all the time have the right structures and agreements in place. Without those, you're in for a wild ride.

Have a lawyer draft up the right type of agreements for the companies. The type of agreement will depend on the nature of transactions and relationship of the involved parties.

Toggle signature
This is the probably the answer to your question.

 

[JohnLocke]

I totally agree with @Sols this time 🙂

Anyway, there is nothing wrong if you let another company do the deal and invoice on behalf of the other company as long as the money is floating straight and is transparent. We do it all the time and do both accounting and audited accounts each year.

Toggle signature

>> Unlock the Power of OffshoreCorpTalk: Become a Member of the Mentor Group Gold <<​

Latest Video Interviews, Offshore Company Resources, Payment Processing Tips & Tricks, Articles and Anonymity Hints only a click away!
Support the Freedom of Speech of our Community

Disclaimer: Nothing I say should be taken as tax, legal or financial advice. Anything I say is for general informational purposes only. Always seek independent professional advice.​