I run two “businesses” (say, A and B) as a sole trader, and have two separate QuickFile accounts, one for each business. Each business has also its own Starling Business bank account.
Recently I needed to make a purchase for business A, but had insufficient funds in its bank account so I transferred funds from business B’s bank account to business A’s bank account.
How do I tag this in QuickFile? Do I tag the withdrawal from business B’s account as Proprietors Drawings, and the subsequent deposit in business A’s account as Capital Introduced?
Is A likely to pay B back at any point soon? If so you could just tag it as a transfer to drawings on one side and from drawings on the other, then do the reverse when repaid.
No, there’s no need to pay anything back. It’s a simple reallocation of funds. The bulk of my income comes from business B, and business A just lacked funds to make the purchase.
Being a sole trader there’s no separation between myself and my businesses, but from an accounting point of view I want (need?) to separate purchases out per “business”.
The type of purchases for Business A (IT consultant) and B (sound engineer) are radically different, and I need to cleanly separate the two businesses on my tax return.
Tag the transfer from business b to a as drawings. Tag the money in to business a as drawings. Then tag the purchase as you would normally.