Hi Rachel, I'm self employed and my understanding is that any money that comes in to the business is income. If you then decide to spend some of this money for personal spending out of the business account, those transactions will not be classed as expenses but the original income will still contribute to your overall income that is used to work out net profit.
If you look at the figure it shows for take home pay and the net profit figure in the P&L report, my understanding is the difference in these two figures is your personal spending.
Hope that makes sense.
