Sole Trader - Petty cash

Gary Toolan

As a sole trader, is there any real distinction between "my" cash and the business's cash (in separate accounts, of course!)? Heres why I ask:-

I've have paid some bills for bsiness when business was short of cash - can I just write a cheque to myself when business is flush?
If so, can such a debt be carried over into the next year if there is insufficient funds in business to repay petty cash owed before year end?
If so, how should it be treated on paper (ie in the accounts)

Explanations (simple, please) would be greatly appreciated.
Regards,
Gary

superhooper

Gary, As a sole trader their is no real distinction between your funds and the business but it does help to keep track of things. If you were running a Limited company there would be a big difference.
When you make your tax return you will need to ensure these expenses are included in your accounts if they are bona-fide business expenses.
There is really no issue as regards carrying these funds forward as they are not really loans but would make up your Capital a/c(not really important though The Revenue may want to know where you got the money in the first place).
Yes you can take the funds back out when the business is more flush.

Gary Toolan

Thanks for taking the trouble to reply - much appreciated.
Gary:)