Forum Discussion

AshleyR's avatar
AshleyR
Experienced User
5 years ago

Pay a bill via the Owners/Shareholders Drawing Account

Hi   My director has used her personal card for a business purchase.  She has allocations in the 3-2000 account.  She wants me to use this personal card transaction to reduce the Drawings account. ...
  • Tracey_H's avatar
    Tracey_H
    5 years ago

    Hi AshleyR 

     

    Thanks for your post. One way to deal with this would be to use a suspense type account as the Pay from Account when processing the Spend Money/Pay Bills transaction.

     

    You could then record a General Journal, debiting the suspense type account and crediting owner's drawings, to clear the suspense account and reduce the owner's drawings.

     

    Please let me know if you need further help.

     

    If my response has answered your enquiry please click "Accept as Solution" to assist other users find this information.

AshleyR's avatar
AshleyR
Experienced User

Still in relation to this issue ...

 

I've now been asked to set up a weekly deduction from the owner's pay where a set amount will be directed into this 3-2000 account.

 

Of course I set this up as a deduction and everything works fine (paygw, super, net goes to 3-2000 rather than director).  Where I've come unstuck is getting this amount out of Pay Liabilities.  There's nowhere for this to go from this window, but all deductions go there. 

 

How do I now clear Pay Liabilities?  Every permutation I think of leaves an account unbalanced because everything is where it needs to be. 

 

 

Tracey_H's avatar
Tracey_H
Former Staff
5 years ago

Hi AshleyR 

 

This one I'd be careful about how you record it. For example, is it a genuine payroll deduction or is the director just repaying the drawings account? One way to deal with the director repaying the drawings is to process payroll as normal but, instead, of transferring the net amount to the directors bank account the repayment amount gets transferred to the drawings account. 

 

If you do want to record this through payroll, you need to change the Linked Payable Account for the deduction payroll category. Normally it would be the liabilities account but you can change it so the deduction doesn't get allocated to the liability account.

 

I'd recommend checking with the accountant about the best way to record this for your business/director. Once you know how it needs to recorded let me know and I can give detailed instructions if needed.

  • AshleyR's avatar
    AshleyR
    Experienced User
    5 years ago

    Thanks Tracey. 

     

    The director is diverting 1 day's net pay to the drawings account so it is a genuine payroll deduction. 

     

    I did change the Linked Payable Account to the drawings account, which correctly redirects that 1 day's pay, but it's still creating an entry into the Pay Liabilities section.  It's this entry I need to clear.   Right now I have 2 amounts sitting in there and I have no idea how to get rid of them.  They're both showing as being in the drawings account. 

     

     

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