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Automatically allocate Intercompany expenses/costs

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Is there a way to automatically allocate intercompany expenses/costs to another company in the same envrionment. I know it can be done manually by taking the purchase invoice and adding lines to allocate the portion of it to the intercompany partner. It then appears as a journal on the other company for posting.

But, say you wanted to always allocate 40% of a expense/cost - any ways to automate this?

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Valentin Castravet 32,200 Super User 2026 Season 1 on at

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As far as I know there's no out of the box feature that does this. You'd have to customize the system to do it for you.

Valentin Castravet
Work: Zander ERP Services
Blog: Dynamics 365 Business Central Insights
LinkedIn: www.linkedin.com/in/valentin-c-0500a247/

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Gregory Mavrogeorgis 992 Super User 2026 Season 1 on at

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Hi,

Totally—there are a few easy ways to make a “40% to the sister company” rule happen without retyping it every time:

Recurring IC journal with a % split (set-and-forget).

Make an allocation key that says “40% to Company B.”

Create a recurring intercompany journal line using that key.

It’ll post on your schedule and push the matching entry to Company B automatically.

Best for regular bills like rent, SaaS, utilities.

Auto-prefill the split on purchase invoices.

If it’s usually the same vendor, add Standard Purchase Lines to that vendor: one line for 60% to your G/L and one line for 40% with the IC partner code.

Each new invoice suggests both lines—type the total, done.

Light automation for variable bills (no manual touch).

Post the invoice in Company A as normal.

A small Power Automate/Job Queue flow spots the posting, calculates 40%, and creates an Intercompany General Journal to Company B for you.

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OussamaSabbouh 12,880 Super User 2026 Season 1 on at

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Hello,

You can automate fixed intercompany cost splits in Business Central using Cost Allocations.
Define a static rule (e.g., 40%) between companies, then run the allocation batch job to post automatically.

Regards,
Oussama

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Jeffrey Bulanadi 9,112 Super User 2026 Season 1 on at

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Hi,

BC allows you to allocate intercompany expenses using either Intercompany General Journals or purchase documents, and while the system doesn’t auto-split costs by percentage out of the box, you can build a repeatable allocation pattern using templates and recurring journals.

Let’s take this next step

1. Use Intercompany General Journals

Create a journal line for the full expense in the originating company.

Add a second line to allocate 40% of the cost to the intercompany partner using Account Type = IC Partner.

Specify the IC Partner G/L Account No. and Bal. Account Type = G/L Account to complete the transaction.

This will generate a matching journal in the receiving company for posting.

2. Automate with Recurring Journals

Use Recurring General Journals to predefine the 40% allocation logic.

Set the Recurring Method = Fixed and define the Amount and IC Partner.

This allows you to post the same allocation monthly or quarterly with minimal changes.

3. Use Purchase Documents for Centralized Expenses

If you’re using centralized purchasing, you can enter a Purchase Invoice and add lines for each intercompany partner.

Allocate 40% of the invoice to the IC Partner using a separate line.

BC will generate an Intercompany Purchase Journal in the receiving company.

4. Consider Custom Extensions (Optional)

If you need full automation (e.g., auto-split every invoice by 40%), consider a custom extension that hooks into the OnAfterPostPurchaseInvoice event and triggers intercompany allocation logic.

This is useful for shared services, rent, or IT costs that follow a fixed distribution.

Helpful Reference
Allocate Costs to Intercompany Partners – Microsoft Learn
Fixed Allocations in BC – CALSZone
Automated Intercompany Transactions – ArcherPoint

If you find this helpful, feel free to mark this as the suggested or verified answer.

Cheers
Jeffrey

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Rishabh Kanaskar 6,219 Super User 2026 Season 1 on at

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Hi,

Business Central supports automatic allocation of intercompany expenses using Intercompany General Journals and Recurring General Journals.

You can set up recurring general journals with fixed allocation percentages (e.g., 40%) to distribute costs across intercompany partners.
The Intercompany General Journal allows you to post expenses to one company and allocate portions to others using the IC Partner account type.
You can also enable automatic acceptance of intercompany transactions in Feature Management to streamline the process.

Thanks

Rishabh

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Jainam M. Kothari 15,735 Super User 2026 Season 1 on at

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Hello,

Business Central supports intercompany transactions, but it doesn't natively automate fixed expense allocations (like always allocating 40% to a partner company).

While manual allocation via purchase invoices and intercompany journals is standard, automation can be achieved through recurring journals, custom AL extensions, or Power Automate flows that apply predefined allocation rules—making the process more efficient for consistent cost-sharing scenarios.

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