I have invested private money into the business bank account which has already been taxed, to give it some working capital, but I want to be certain that when I take drawings for living expenses from the account, it will be offset against the invested amount, and I won’t be taxed on it like normal drawings.
How do I record the money into the bank account and drawings from it to ensure this?
For a partnership, capital invested and drawings taken are irrelevant to income tax - all that matters is the actual trading profit or loss, plus capital allowances on assets.
Drawings are not taxed.
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