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Anonymous
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Expense or transfer when moving money between director loans account and bank account

Hello,

I am a sole director of a LTD. I have a Director Loans Account set up as a credit card in Quickbooks (advice received when reading this support site), which is working well for me.

What I have done:

1. I made some asset purchases with my personal money. 

2. I added these items as sub-categories to tangible assets with depreciation. 

3. I created an expense, itemised the purchases,  linked them to the original costs row of each asset in tangible assets and selected the Director Loans Account as the account.

This all works as I expect. But I have one question:

Currently when I then pay myself from my business account to my personal account I select this as an EXPENSE and it reduces the money owned to me in the DLA. But, should this actually be a TRANSFER? Do is make any difference?

Thanks,


Scott

Solved
Best answer 02-07-2019

Accepted Solutions
Established Community Backer ***

Paying down a loan, which is what you are doing, is not a...

Paying down a loan, which is what you are doing, is not an expense

You can use transfer from the plus menu, or enter an EFT check, do not print, in the source account and use the loan account as the expense for the "check"

expense for the check just means the reason the check was written, it does not mean an actual expense account must be used or that it will show as an expense on the P&L if you use a loan account

View solution in original post

1 REPLY 1
Established Community Backer ***

Paying down a loan, which is what you are doing, is not a...

Paying down a loan, which is what you are doing, is not an expense

You can use transfer from the plus menu, or enter an EFT check, do not print, in the source account and use the loan account as the expense for the "check"

expense for the check just means the reason the check was written, it does not mean an actual expense account must be used or that it will show as an expense on the P&L if you use a loan account

View solution in original post