Mixing Personal and Business Transactions is becoming problematic for bookkeepers and accountants.
It is, of course, also a financial issue for the business owner. If your current bookkeeper and/or accountant ignores the issue, be wary. The time spent differentiating between personal/business transactions on bank statements etc costs you, the owner, money. If you are charged by the hour, you can be sure at least an hour is being spent working out and allocating the ‘Boots The Chemist’ and arbitrary cash withdrawals shown on your bank statement.
Talking of cash withdrawals, these are especially notorious and undoubtedly cost owners a lot of money annually. I don’t have figures to prove my conviction, but in the absence of receipts (lost in the wash perhaps), how do you convince the Taxman that you spent that withdrawn £100 (incidentally the most popular withdrawn amount) on stationery and transport and …..? Isn’t it just easier to see a card/BACS transaction indicating a shopping spree in WH Smith, even with no receipt to show for it?
Do yourself a favour – keep personal expenses personal! If you need regular access to cash, either operate the dreaded petty cash system or set up a transfer to your personal account monthly. Pay yourself a salary if you must. The business is a separate entity and you are you – the custodian.