I’m a new sole trader and I’ve been logging business Purchases and (having now made some sales) I’ve just reimbursed myself for General Purchases and Expenses showing on the P&L (from current account to proprietor drawings). I’ve also been taking day-to-day Expenses in the same way as they’ve been incurred, recording them as proprietor drawings in my banking, but not recording them as Purchases.
My question is what to do about these day-to-day Expenses such as Travel, Working From Home, Mileage etc? Should they also show up on the P&L and if so, how should they be entered in Purchases? Some have cash receipts so I could add each as a Purchase, but there’s no Supplier for Mileage or Working From Home, for example. Do I need to record every individual purchase and create a supplier for each (e.g. Boots - Sandwich)?
These expenses are all business expenses, so I assume they should be added to my accounts as such, in the same way as I’ve logged Expenses for tangible items like Stationery as Purchases.
If I’m right, how do I enter such expenses as Mileage without a Supplier? I could feasibily set up TFL as a Supplier and create Purchases for Tube Travel or Congestion Charge etc. even set up Boots The Chemist as a supplier for my on-location lunch, but I’m stumped otherwise.
Drawings are money from the sales which do not form part of your expenses but have been taken for personal expense. I’m sorry to say you’ve been doing it wrong.
