I have a new client that I have set up in QB's and she has kept all of her petrol receipts, this was before she decided that she wasn't going to go down this route, she is now doing the Mileage route and keeping a Mileage record. With these receipts that have come out of the business bank account I'm assuming I record them to the DLA account? She is a LTD company and its just herself she doesn't employ anyone. She is a new Ltd company.
If she was a Sole trader I would have put them to Drawings in QB.
Please can someone confirm that this is correct?
This is what I have done in Sage previously for a Director. All my guys on QB are sole traders, although I have one who is just about to convert to Ltd.
I would bundle them all up and include them in a dividend at year end.
As you say, for now sweep them all up and dump them in a DLA to be cleared down at yearend.
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Shaun
Responses are not meant as a substitute for professional advice. Answers are intended as outline only the advice of a qualified professional with access to all relevant information should be sought before acting on any response given.
Another question, it appears there have been a few C/Cards/Deb Cards used, I think this was because she was waiting for money to come into the business account so used personal cards instead to buy stuff for the business, would it be best to add a separate account on QB bank for this just to show where the payments have come from? I would anticipate there won't be too many now now the business is up and running.
I would treat the use of own cards as capital introduced by the owners to the company rather than treating them as payment of goods directly.
I know that the result is the same but it makes things less complex in the long run.
Once money is coming into the company then just transfer the owners capital back out again... Or leave it in the DLA which may balance out the petrol expenses already taken and annul the need for a dividend.
Oops, seem to have slipped into accountants territory.
For recording I would record the payments on personal credit cards as increases in owners capital but also record the payments from capital to the various accounts (which would balance out the introduced capital).
Then reduce the capital by a payment to the directors own account from which they pay off their cards (not pay personal cards directly from the company even though the effect is the same and it could be done that way).
That's my approach but others may approach the situation differently. I just like to have total segregation between company money and owners money.
Hope that helps,
Shaun.
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Shaun
Responses are not meant as a substitute for professional advice. Answers are intended as outline only the advice of a qualified professional with access to all relevant information should be sought before acting on any response given.
I tend to set up a separate bank account for all the spending on random cards, and then at the end of the year/period transfer the balance to the DLA. Less transactions!
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Jenny
Responses are my opinion based on the information provided. All information should be thoroughly checked before being relied on.
