Forum Discussion

ComeFixit's avatar
ComeFixit
Experienced User
5 months ago
Solved

Paying myself a wage from time to time

Hi there again,

I'm a new sole trader only 4 months in.

I will like to start paying myself a wage from time to time only,

and not on a regular basis just yet for the obvious reasons.

Could someone be so kind as to advise on how I would lodge this on MYOB SOLO.

Best Regards

  • Han-Solo's avatar
    Han-Solo
    5 months ago

    Hi ComeFixit​, 

    You’ve got it 🙂 as a sole trader, paying yourself isn’t considered a wage or salary, it’s simply money you’re taking out of the business for personal use. That’s recorded as “drawings” rather than an expense.

    In Solo, you don’t need to record anything extra beyond noting the transfer as an owner drawing. The key thing to remember is that drawings don’t reduce your taxable income, your profit (business income minus business expenses) is what you’ll be taxed on.

    If you’d like to read more, here’s the guide that steps through how it works: How to pay yourself as a sole trader.

    And of course, it’s always best to check with your accountant for advice tailored to your situation, as this is general advice.


    Kind regards,
    Hannah

4 Replies

  • Han-Solo's avatar
    Han-Solo
    MYOB Staff
    5 months ago

    Hey ComeFixit​, 

    Great question! In Solo you wouldn’t record this as a wage, but instead as an Owner Drawing. That means when you transfer money from your business account to your personal account, you can tag it as a drawing so it stays separate from your business expenses. You’re taxed on your business profit (not the drawings themselves), but how you manage this can vary depending on your situation, so it’s always best to double-check with your accountant or advisor. We’ve got a step-by-step guide that explains the process here: How to pay yourself as a sole trader 😊

    Thanks, 
    Hannah

  • Han-Solo's avatar
    Han-Solo
    MYOB Staff
    5 months ago

    Hi ComeFixit​, 

    You’ve got it 🙂 as a sole trader, paying yourself isn’t considered a wage or salary, it’s simply money you’re taking out of the business for personal use. That’s recorded as “drawings” rather than an expense.

    In Solo, you don’t need to record anything extra beyond noting the transfer as an owner drawing. The key thing to remember is that drawings don’t reduce your taxable income, your profit (business income minus business expenses) is what you’ll be taxed on.

    If you’d like to read more, here’s the guide that steps through how it works: How to pay yourself as a sole trader.

    And of course, it’s always best to check with your accountant for advice tailored to your situation, as this is general advice.


    Kind regards,
    Hannah

  • ComeFixit's avatar
    ComeFixit
    Experienced User
    5 months ago

    HI Hannah, 

    Thanks once again for confirming this all.

    Really appreciate the time you've taken out for this.

     

    Kind regards

    Rob

  • ComeFixit's avatar
    ComeFixit
    Experienced User
    5 months ago

    Hannah, thanks so much for your prompt reply and the time taken to explain. I really appreciate this.

    So I'm of the understanding that I would simply record "owner drawing" from my business to private account transfer?

     and is there anything further needing to recorded on the MYOB app?

    Yes I have already come across the link you sent me, thanks, however it seems is doesn't specifically state the precise recording of how it should be done.

     

    Kind regards

    Rob

Looking for something else?

Search the Community Forum for answers or find your topic and get the conversation started!

Community home

Dig into MYOB Academy for free courses, learning paths and live events to help build your business with MYOB.