Apologies for what might be a simple process, but I have not come across this before so any help would be useful.
We have recently set up a subsidiary company in Mauritius, wholly owned by the UK company.
There are staff and office costs in Mauritius and these will be recharged back to the UK company. The Mauritius company has its own bank account, so the UK will send money to enable them to pay wages etc.
For accounting purposes, is the best way to arrange a monthly management charge invoice from Mauritius to the UK, with a markup, and then the UK pays these invoices? Or is it best to a monthly journal and then do an annual invoice once that year end is finalised?
The VAT is another issue, but I will have to check this with the Mauritius authorities as I don't know whether Mauritius would charge VAT on a management charge to a UK company!