Director Contributions

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Director Contributions

Hi,

 

I have done the following

 

1. Spent my personal money using a personal cheque and credit card to setup the company and pay for website hosting

 

2. Transfered my personal money from my personal cheque account to the company account.

 

I created a Credit Card LLiability Account called:

2-1100 Loan - From Director

 

Then Banking -> Spend Money ->

I recorded all my purchases I did with suppliers e.g. ASIC, Website hosting, Domain name etc

 

My balance sheet now reflects the correct liability owed to me.

 

I have 2 questions.

 

1. How do I record the money I transfered from my own account to the business acccount?

2. When the company has enough money, how do I record paying the director back?

Record Spend Money.PNG
Balance sheet.PNG
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MYOB Moderator
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Re: Director Contributions

Hi @Romiko

 

Thank you for your post. 

 

Generally speaking you can record the transfer of money to the business account as a transfer funds. The Pay from account is the Director loan account and Pay to account is the bank account.
When repaying the director, you can record another transfer funds transaction but the pay from account will be the bank account and pay to account will be the bank account. These transfer funds transactions should match the amounts actually transferred in Internet banking.
 
Help article Transferring between accounts has the instructions on how to do this within Essentials. Additionally if you do have any concerns of which accounts to use I would highly recommend speaking to your Accountant or Financial advisor on how to record these transactions within your software. 

Cheers,
Melisa

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Re: Director Contributions

Hi,

 

Thanks for the advice. Will try this out. My only concern is for this scenario

When repaying the director, you can record another transfer funds transaction but the pay from account will be the bank account and pay to account will be the bank account. These transfer funds transactions should match the amounts actually transferred in Internet banking.

 

If I do the above. The Balance Sheet would still show a liability that the company owed money, since repaying the directory does not reduce the directory liability account?

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Re: Director Contributions

Hi @Romiko

 

My apologies I've made typo in my previous response, the Pay to account should have been the director loan account. This will clear the director loan liability account. 

 

Please let me know if you have any further questions. 

Cheers,
Melisa

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Re: Director Contributions

@Romiko @Melisa_D 

 

Romiko,

 

For fees paid to ASIC, I use a ledger called Filing Fees - ASIC.

I understand ASIC does not charge GST.

 

Duncan

Duncan Smith
Business Advice + Tax
Helping business owners build a better business since 1998
E expressgst@optusnet.com.au T 02 9904 3672 7 days

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