Third-Party Transaction


DEFINITION of 'Third-Party Transaction'

A third-party transaction is a business deal involving a buyer, a seller and a third party. The third party's involvement varies with the type of business transaction. For example, an online payment portal, such as PayPal, acts as a third party in a retail transaction. A seller offers a good or service, and a buyer uses a credit card entered through the PayPal payment service. The payment is run through a third party, and is therefore a third-party transaction.

BREAKING DOWN 'Third-Party Transaction'

Third-party transactions are important for various accounting policies and occur in a variety of situations. Importantly, the third party is not affiliated with the other two participants in the transaction. For example , if Firm A sells inventory to its subsidiary, Firm B, a third-party transaction occurs when Firm B sells those final goods to Firm C.

  1. Third Party

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  2. Qualifying Transaction

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  3. Joint Venture - JV

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  4. Business

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  5. Partnership

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    1. The process by which investment bankers raise investment capital ...
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