Expenses

[chayofa]

Hi

I have just started using the accounting package and very impressed so far. Managed to put in a year of accounts in a couple of days as quite easy. So far Im wishing Id found this software years ago :-)

I have a couple of questions

1.
If Im paying my expenses like mileage out of my directors wages do I also need to enter those expenses in the purchases spreadsheet? For example if i paid myself £1000 and my mileage was £100 cost one month should i put wages to me as £900 and travel as £100 ?

Or does the software somehow automatically work out what to do with the expenses spread sheet and put in somewhere else to be accounted for??

2.
Am I right in thinking that the only spreadsheets i need to fill in to do the correct CT600 (if i only have one bank acount i use ) is the

a. Financialaccounts.xls

b. The sales.xls

c. The purchases.xls

Thanks in advance...

[Lord Hutton]

You should make separate entries for expenses, not deduct them from your director's salary. This applies if you are paying the actual expense either from your personal bank/credit card or your business bank/credit card. If the expense has been paid for from your business accounts then you will have entered these either in the current or credit card sheets as they occur, with a corresponding entry in "purchases" coded to travel, hotel and the like. If you have paid for them from your personal accounts, bank or credit, then you need to enter the amounts as "purchases" as above, and then make a transfer for the amount on a monthly or as required basis from business current a/c to your personal bank a/c i.e. reclaiming your expenses from the company. The actual expenses spreadsheet is not linked to the DIY-Package "financial" summary as far as I am aware, but is just a tool for you to record and summarise data as it occurs to facilitate the entries required above.
Depending on the nature of your business, you need to at least make entries in: sales, purchases, current a/c, saving a/c (if used), cash a/c (if used), credit card (if used), the wages interface to record your salary, PAYE, NIC, and the Company Secretary (to record dividends). The FinancialAccounts update directly from these inputs to generate the P&L, CT600 etc.

[leansoftware]

please see next post

[leansoftware]

Dear Friends

I am having a go now with setting up this years accounts.

Just as regards expenses I need some help.

I have paid for train fairs etc from my personal credit card.

I have completed an expense claim form for Febuary detailing all amounts using the expenses spreadsheet, some items include VAT some do not. As I work from home I have also entered amounts for 1/5 electric & heating and 1/2 of Telecomms bill.

Should I now enter a single amount into Puraches eg 'RDB Expenses FEB 2010' and then an amount into Bank for the BACS payment amount to RDB personal account?

Many Thanks

[leansoftware]

I realised that by placing all expenses into one line on purchases that I would not be able to break down into correct expense codes, so I have now duplicated the items in the expense claim in the purchases sheet so that I can post each into correct expense code.

My expenses out of pocket included things like domain hosting, percentage of heating etc.

I have realised I need to make life a lot easier for myself and have a seperate payment card for the company and avoid some of this expense claiming.

[Lord Hutton]

You are following the correct procedures. Just group all "like" expeditures together so that you can apply the correct codes. Obviously if your base is working from home and your domestic bills are being direct debitted from your personal accounts you will need to claim that portion to set against your business. Your bank should have provided you with a debit card for your business accounts so you can use this for dedicated business items. Also it might be possible to get a business credit card, though if you are earning airmiles or some other reward on your personal cards then don't bother! At the end of the day it is what is convenient for you. Keep and file all receipts, including those for fuel even when claiming the 40p per mile allowance on your car. Spending 30 minutes once a month doing an expense claim and moving the money between your business and personal accounts should not be a problem.