Hi, I’m aware that if an invoice has been paid to the director personal account, this can be recorded through Directors Loan Account. My question is if DLA balance is negative and high enough to cover the total value of the invoice, I should do nothing else than record the payment to DLA and that will be just deducted from it.
Thanks for your help in advance
Paid to the directors personal account or paid from the directors personal account? Your question isnt very clear
If an invoice is paid “from” the directors personal account then it is money owed to him. If an invoice is paid “to” then it is owed to the company.
If the directors loan account is showing as a liability then the company owes the director money in which case yes you can leave it how it is, if its showing as an asset then it should be repaid or taxed accordingly.
Sorry for the confusing question, but you’re actually confirming what I thought. This is an invoice paid to the director personal account from a client. Following what you’re saying, since the DLA is showing as a liability I can leave it as it is.
Many thanks for your help