How to manage delegation of payment for suppliers and subcontractors

Another case is delegation of payments for suppliers/subcontractors.
I found this English description rather useful:

In a given invoice, a company may have one or more suppliers/contractors that will be paid directly by the client, necessitating the need to stipulate, along with each direct payment, the corresponding amount.

Therefore, an ‘in’ invoice (supplier) has a payment line per payee for the given amount, the balance for the supplier, all with the same due date.

Likewise for an ‘out’ invoice (client), where upon the payer (or delegate) indicates the payment date, the move can be created to reconcile with the receivable move line…

VAT implication is certainly the same as above with only the invoicing supplier or invoiced client involved.

(Why is the title changed?)

The supplier ‘in’ invoice case, I believe can be easily handled as there is no accounting document to enter for the third party payee, only the bank account.

Therefore a simple payment line that reconciles via a compensation move back to the original invoice with the appropriate amount upon payment is fine.

For client ‘out’ invoices, typically the suppliers and/or subcontractors have already communicated their invoices which have been entered. There, a nice possibility would be able to select the payable lines for each alternative payee and correct the amount if needed (i.e. a partial payment).

When the payment by the client is confirmed for those, the compensation move and reconciliation with the client invoice can be made confirming the payment date for the suppliers/subcontractors (necessary for VAT purposes, namely for cash basis and autoliquidation suppliers).

In other words, the only tangible difference at invoice time in all these (including subrogation) is the possibility of selecting an invoice /invoice amount for the alternative payee. In absence of such, there is only the party, address, bank account and amount.

NB: The address is always necessary as the payment means may be by check or exchange bill.