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Using Director Loans Accounts

Question asked by Matthew Walker 4 years ago

Hi,

I'm a bit confused using the Director Loans account, so I'm hoping someone can explain to me!

I've set up a Directors Loan account under Bank Accounts (note I've been using ClearBooks for about 8 months now, up until now everything just come out of the main back account).

Now Yodlee has brought across my transactions, which include my dividends, salary etc, for my business account. But I'm confused as to how I should reconcile this.

As far as I understand, any payments for me (salary, dividends, expenses, loan) should go:

Main Account > DLA > Personal Bank Account

How should I actually handle this? How do I reconcile the imported transactions from the Business Bank Account, and ensure that everything is still allocated to the correct codes?

Also, moving forward, if for example I am owed some expenses (which I am), what's the best way to put that into the DLA for me to withdraw later (and again reconcile the withdrawal)?

Thanks

Matt

P.S. I also have an employee who withdraws a salary, dividends and expenses - should they have a similar account, even though they are not a Director?

6 Replies

Hi Matt,

You may want to confirm this with an accountant, however, I would advise explaining your salary and dividends as separate transactions (not transferring to DLA). If you use our dividend tool to create the dividends you would need to explain the payment on the imported statement like so:

file

You would need to explain your salary in a similar way - just update the account to an appropriate account such as salary.

You can use your DLA account to pay for expenses - click on any bills that were paid by yourself and use the quick pay form to mark them as paid with the DLA:

file

Any money that is paid back to you from your business can be explained as a transfer on the imported statement:

file

As for your employee, we have an employee expenses feature which will allow you (or them if they have been invited in as a user on the account) to add them in. The guide below should help explain this process - if you have any further queries about any of this please let me know.

https://www.clearbooks.co.uk/support/guides/expenses-2/expenses/

Thank you for your answer - that makes sense, and I'll do it that way.

I also have the following question if you can help me:

My current share structure is:

51% normal shares to me 49% normal shares to my employee

I am updating this to:

51% A shares to me 49% A shares to my employee 100% B shares to me 100% C shares to my employee

I know that ClearBooks doesn't support this at the moment, however is there anything I can do in the journals?

Many Thanks

Matt

No problem Matt,

Yes I think you can do this via journals, however, I will escalate to our support accountant who will be able to give you the best advice on this - she should be able to help tomorrow.

Hi Matt

As John mentions, you can get it done by a work around with help of journals.

I will send a document with steps and screenshots to your email ID on our system.

Best regards

Latha

Latha Bala

Accounting Specialist - Product

Hi,

How do I transfer my annual dividend in to my DLA for me to draw down in the future when I need to?

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