Will be grateful for your advise, its a hard one to crack for me!
Company owner has another business registered overseas. On a few occassions he purchased goods/services/assets through UK business for his overseas business (as it is easier and his UK business has has account with supplier already); then the value of the goods is invoiced to the overseas company. Sometimes whole batch is intentionally bought for overseas company and sometimes he purchases goods for UK operation and eventually sells part of it to the overseas business if needed.
The question is how would I post such purchase transactions? i am using sage instant accounts if it helps... - When whole batch is bought intentionally for overseas company shall i make separate nominal code for purchases made for overseas business and posting will be DR this code CR supplier? Or do i make normal posting as for UK business, i.e. DR goods CR supplier? - If it is better to post to a specially created nominal code what do i do with the part batches? Say, i have already made posting of DR Goods CR Supplier, then part of the batch sold to overseas business. Do i need to CR goods and DR this nominal code? - What to do with VAT for the transactions? I feel that it's somehow wrong to claim it back as input tax but not sure, cant find anything clear on vat for connected companies on hmrc site. If i can't claim it back again what do i do with the part batches when part is used for UK and vat already was claimed back.
