We have all done this - it’s our business so it’s our money. However from a Bookkeeping point of view this can be confusing & ultimately cost you data entry fees, plus eligible tax deductions could be forgotten. Try not to pay personal expenses from any business account & try not to pay business expenses from any personal account. Designate at least one Business & one Personal account & have one credit card for business expenses only. This will help to keep your records straight and save you on those data entry fees. It is a good idea to transfer a larger sum to yourself than to keep paying small personal bills from the business.
We can check with your accountant how best to take the funds (salary or dividend).
We can help- Talk to us today
This is exactly what I did when I was still in business. In fact I gave myself a monthly "salary", transferring the amount into my personal bank account at the beginning of every month. As you mentioned, in addition to the separation of personal and business expenses, it also makes record keeping a lot more straightforward. MYOB and Quickbooks are great accounting applications for business, but are over the top for personal accounts. I used a more appropriate application to track my personal account giving me accurate pictures of both business and personal.
ReplyDeleteThanks for the input, Chief. Do you mind sharing what sort of application you used to track your personal accounts?
DeleteI admire this article for the well-researched content and excellent wording. I got so involved in this material that I couldn’t stop reading. I am impressed with your work and skill. Thank you so much. us customs data
ReplyDelete