Ltd Company

honeymonster

Hey,

I was hopping to get some advice from the experts in the forum. Any time I dont have a clue about something I just post on boards and get a flood of info, its brilliant! and has saved me getting in a lot of trouble. I set up a Ltd company, and I paid for all the inital costs to get it going. Now its starting to make a profit after a couple of months, can I declare the money I put in as a loan to the company and just pay the money into my account? Do I need to charge interest?

Best Regards,

Stephen

jayok

If you setup the company out of your own pocket, put the costs and invoice against the business (i.e. in your purchasable invoices book). Even though you've paid for them personally the business will actually owe you the money back. It will be held in a Directors current a/c (if you are a director) and can be re-paid at any time.

Technically you could charge interest, but TBH the paper work on it and the tax on it won't make it worthwhile.

ircoha

all relevant costs incurred before the date of incorporation are called pre-incorporation expenses and are allowable as an expense, as are all the other costs u paid for as long as they are co related.
Just make sure you have receipts for everything and write a co cheque to yourself, and book the expenses in the right places in the accounts.


eg:
Dr Legal Fees 100
Dr Fone 50
Dr Stationary 20
cr Bank 170

dont bother with interest unless the amonts are enormous, only attracts undue attention.

are u running the bus from home, if so other issues

Hitchhiker's Guide to...

ircoha wrote:

all relevant costs incurred before the date of incorporation are called pre-incorporation expenses and are allowable as an expense, as are all the other costs u paid for as long as they are co related.
Just make sure you have receipts for everything and write a co cheque to yourself, and book the expenses in the right places in the accounts.

If the business has been running for a few years - as kinda seems the situation here, can you just suddenly add a pre-incorporation expenses line to the accounts? Should this not have been done in the first year's filed accounts?

ircoha

RT2: I based my opinion on this for the original post:

and I paid for all the inital costs to get it going. Now its starting to make a profit after a couple of months.