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kimmarie122
Level 1

How do i categorize a personal purchase on a business credit card?

I understand i should not mix personal and business accounts. I plan on rectifying this in the future. I am a sole proprietor. I occasionally make personal purchases with the business credit card. I pay the business credit card with the business checking account. How do i categorize the personal purchase? Should i exclude the personal transaction? I just set up an owners equity draw account. Do i add it to owners draw account or transfer it to owners draw account? Is there a difference between adding it or transferring it? 


Solved
Best answer October 15, 2018

Best Answers
Raywhite28
Level 7

How do i categorize a personal purchase on a business credit card?

It's an owners draw.

It shouldn't matter.

View solution in original post

13 Comments 13
Raywhite28
Level 7

How do i categorize a personal purchase on a business credit card?

It's an owners draw.

It shouldn't matter.

LKramer82
Level 1

How do i categorize a personal purchase on a business credit card?

I don't see owners draw.. I just see owners investment, and owners pay & personal expense...
john-pero
Community Champion

How do i categorize a personal purchase on a business credit card?

You have to add it
LKramer82
Level 1

How do i categorize a personal purchase on a business credit card?

Super new to this... the account type should be equities, correct? I don't see owners draw under there.. Closest thing was personal expense.
john-pero
Community Champion

How do i categorize a personal purchase on a business credit card?

Owner Draw is an equity account but QuickBooks won't auto create it. Add it new. Personal Expense might be set up as equity nut should not have expense in its name as it is not an expense for the business.

By any chance are you using Self-employed, not a full QBO? It is the only QB product where you cannot edit your Chart of accounts
Natalie01
Level 1

How do i categorize a personal purchase on a business credit card?

Can you use owner's distribution?

Miguel Alva
Level 1

How do i categorize a personal purchase on a business credit card?

Where you able to figure this out? 

I just upgraded to QB online from self employed.  I'm also having a hard time categorizing a personal expense on a business cc and paying the cc from a business checking account. 

Mich_S
QuickBooks Team

How do i categorize a personal purchase on a business credit card?

We thank you for choosing QuickBooks, @Miguel Alva.

 

Allow me to help you categorize a transaction in your account.

 

You should record in QuickBooks whenever you use a business account to pay for a personal expense. Then you can reimburse the company.

 

Here's how you can record a personal expense:

 

  1. Select + New.
  2. Choose Check or Expense.
  3. Select a Payee from the drop-down ▼.
  4. Select the Account you used to make the purchase.
  5. Select the tax category that fits your need.
  6. Enter the Amount.
  7. Select Save and close or Save and new.

Please review this article for the detailed steps: Pay for personal expenses from a business credit card or bank account.

 

Just leave a comment if you have further questions. Have a nice day!

paulboth
Level 1

How do i categorize a personal purchase on a business credit card?

I understand all of this, but how do I handle it if I pay the personal expense on the credit card with my personal bank account. I don't have my personal checking account in Quickbooks and from what I understand, I shouldn't..

Thanks for any help on this

Encuaccounts
Level 1

How do i categorize a personal purchase on a business credit card?

What if I have linked my credit card. The transaction shows up as Credit Card Expense. I need to add a trnasaction that shows it as owner's draw also. Currently I added the category owner's draw to the transaction  with the payee as credit card. How can I handle this. 

 

 

Thank you,

Rose-A
Moderator

How do i categorize a personal purchase on a business credit card?

I'd be please to help you add a transaction showing as owner's draw in QuickBooks Online, Encuaccounts.

 

To enter a transaction showing as owner's draw, you can write a check or an expense transaction. Here's how:

 

  1. Click + New and choose Check or Expense.
  2. Choose a Payee from the drop-down ▼ menu.
  3. Select the Bank Account you used to make the purchase.
  4. In the Category details section, select the drop-down menu ▼ to select the tax category that fits your need.
  5. Enter the Amount.
  6. Select Save and close.

 

Once done, you can follow and proceed to Step 2 in this article to reimburse the company: Pay for personal expenses from a business credit card or bank account. 

 

You might want to visit this write-up: Mixing business and personal funds. This will give you scenarios and links for the step-by-step process of handling personal funds in QuickBooks Online.

 

Feel free to drop me a line if you have any other QuickBooks concerns. I'll be sure to get back to you and help you whenever I can. Keep safe and have a good one.

artetc2144
Level 1

How do i categorize a personal purchase on a business credit card?

I have the same question. Booked the personal expense on the company card to owner's draw. How do I book the payment of that expense which was paid directly to the card company from the personal checking account, not the business account?

LCB2
Level 1

How do i categorize a personal purchase on a business credit card?

Hi John,

 

I have a question regarding how to reverse a transaction because the business Amex was used to pay for a dentist appointment and need to figure out how to undo this I see the examples that are in the forum but they do not match what I'm trying to do. I have attached a screenshot of what displays for me in chart of accounts to create a new one but not sure if the information I entered is correct. I would really apricate your help.

 

Thanks,

Leena 

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