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Hopefully someone can shed some light on this for me. The picture might seem confusing, hopefully it makes sense to someone.
Company B invoices a customer for a vatable service provided. The customer doesnt pay company B. Then company B sells the debt to company C. Company C takes on the debt in its books and pays company B 50% of the debt as a final settlement. Company B allocates the 50 % payment against the invoice it issued to the customer. And company B writes of the remaining 50% as bad debt with a credit note allocated against the invoice. Therefore the invoice is fully cleared between company B and the customer.
Now for the actual question. What documentation would company C have between itself and the customer, with regards to SARS requirements and Vat implications and if it would be Tax invoice or a debit Note, seeing as the original vatable service that was delivered cant be on two different Tax Invoices?
Company B invoices a customer for a vatable service provided. The customer doesnt pay company B. Then company B sells the debt to company C. Company C takes on the debt in its books and pays company B 50% of the debt as a final settlement. Company B allocates the 50 % payment against the invoice it issued to the customer. And company B writes of the remaining 50% as bad debt with a credit note allocated against the invoice. Therefore the invoice is fully cleared between company B and the customer.
Now for the actual question. What documentation would company C have between itself and the customer, with regards to SARS requirements and Vat implications and if it would be Tax invoice or a debit Note, seeing as the original vatable service that was delivered cant be on two different Tax Invoices?
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