Thanks Adrian,All I'm attempting to discover is how - in gnucash - can I use what is owned by somebodyA to pay off what is owed by somebodyB? What is the procedure for using what is owed by one person to relieve another of the debt they owe?
On paper, I would take the invoice to somebodyB, copy it and staple the invoice to the invoice to somebodyA and then place the invoice to somebodyA in the paid invoices shoe box.
I'm sorry if I'm sounding exasperated .The legal position in the UK is that if I sell the debt from companyA to companyB then companyA will be liable for income tax or company tax (depending on whether the entity is a natural person or legal person - not that a natural person isn't also a legal person, but a limited company is only a legal person) on the returns they receive for the sale. CompanyB will also be liable for any returns it receives on the debt purchased. So, legally, there is a double taxation issue. Please can we leave the legal stuff out of this - I am a lawyer. It's not a legal question.
Thanks, in hope, Morgan.
I'm not sure that adds much clarity.Your initial description appeared to be that you had two business entities and you were transferring old debts owed to the first entity, to a new one - where you control/own both.Now it appears that you are 'selling a debt' owed by one entity, to another who will ultimately pay it.I'll refer you back to both Michael & David's reply in your linked thread: #1 - (Michael) How would you do this on Pen & Paper accounting?#2 - (David) This is a ultimately a legal question. Get that straight first. Then once you get official advice on how to record this, you have your answer, but if you are having trouble entering the transactions, we can help.We cannot advise you *how* this should be recorded. We can only help with the mechanics in GnuCash.-----For a more general case of transferring the Receivables balance from one 'customer' to another, you would need to employ an intermediary account.Investigate the concept of 'Allowance for Doubtful Accounts' and 'Bad Debt Expense'.Regards, Adrien On 12/5/23 7:52 AM, Morgan Read via gnucash-user wrote:This is a follow up, with - I hope - a bit more precision and clarity - to this post:https://lists.gnucash.org/pipermail/gnucash-user/2023-August/108615.htmlI wish to sell an unpaid invoice made out to business A (old debtor) to another business B at face value - I raise an invoice to business B for the sale of the invoice with the value of the invoice made out to business A. How do I transfer the new amount now owed by business B (new debtor) to clear the debt of business A?I had thought that the process described clear an invoice against a credit note might be adapted to work. However, it does not seem possible to get more than one customer to show in the Process Payment window.
-- Morgan Read Grande Bretagne Em: <email:mstuffATreadDOTorgDOTnz>
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