Loan repayment from personal account

Alicia26 · ‎November 03, 2021

My companies startup loan is being paid out of a personal bank account.

On previous software (Quickfile), under banking, there was a loans section where the Startup Loan account was added along with the opening balance.

Each month when the payment came out, we would add this payment to loan account as a payment from the "Directors Loan account" and then have a separate payment showing a deduction for the loan interest which was attributed to an "Loan Interest" ledger

ie

£120 paid each month from personal bank account

£120 would then be shown as a payment towards the loan and tagged from Directors loan account

On the same (Start up loan account) there would be a deducation of say £20 for loan interest which would be tagged to loan interest ledger

Giving a total repayment amount minus interest of £100

I was wondering what the best way to do this would be on Quickbooks?

GeorgiaC · ‎November 03, 2021

Hi Alicia26, thanks for your post

To repay a loan in QuickBooks Online, you can create an expense transaction (+ New > Expense), entering the date and payment account (the personal account) in the top left, and the loan account as the 'Category' under 'Category details, with the amount to be repaid under amount and the 'Amounts are' drop-down set to 'No VAT'. You can also record this using a journal entry as well. You may want to consult with an accountant.

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GeorgiaC · ‎November 03, 2021

Hi Alicia26, thanks for your post

To repay a loan in QuickBooks Online, you can create an expense transaction (+ New > Expense), entering the date and payment account (the personal account) in the top left, and the loan account as the 'Category' under 'Category details, with the amount to be repaid under amount and the 'Amounts are' drop-down set to 'No VAT'. You can also record this using a journal entry as well. You may want to consult with an accountant.

RoscoPC · ‎November 04, 2021

HI There,

best way I've found to do this is to create a Journal entry.

So you probably already have a loan account set up for the business loan.

Create a new journal with

£120 to the directors loan account.

£20.00 to loan interest

£100 to reduce the business loan.

once you've saved the journal and can see it's done what you want, make it recurring and name it something sensible, like "Business Loan Repay" , whilst saving you have the choice of scheduling it for a set day each month, or save it as Unscheduled then pick from recurring transactions, found as an option under the gear icon, Lists, each time you need to enter it..

Hope this helps.

Kindest regards

RoscoPC

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