Hi. I’ve recently set up business as a sole trader. Before I was able to open a business account I had to use funds from a couple of other accounts and places like my wife’s purse to get started. I’ve created a way to log payments from my business account (NatWest) and didn’t think I had to do anything with the other reciepts, but I’ve just checked the Profit and Loss tab and it’s way out so I’m assuming I have to tag payment with every reciept. What do I tag these other things as if they’ve come from different places? And will they then be shown on the Profit/Loss chart when I do?
Anything that you buy for use in the business should be recorded as a “purchase” in QuickFile, regardless of where the money came from to pay for it.
The workflow I would use is based around the Receipt Hub:
when I get a receipt/invoice for any business purchase I upload it to the receipt hub (either using the “email my receipts” function if the receipt came from the supplier by email, or by photographing or scanning the paper receipt)
I go into the receipt hub section of QuickFile and tag each receipt in there to record the purchase, using the date on the receipt (which may or may not be the same date you paid for it). It’s this act of creating a purchase that causes the expense to appear on your P&L
if it’s something I paid for using the business bank account then I leave it unpaid at this point
then later when I come to tag my current account bank transactions, when I select “payment to a supplier” it will offer me the list of matching unpaid purchases to assign the payment
if it’s something that I’ve paid for out of the business cash box then I’d tick “paid” and select “petty cash” as the payment account
if the purchase is something I’ve paid for with my own money that doesn’t “belong to the business”, then I would tick the “paid” box and select the “proprietor drawings account”
This drawings account is the key to tracking the movement of money between “you” and “the business” - when you take money out of the business account for personal use you tag that as a transfer to the drawings account, when you put your own money into the business then those transactions are treated as money out from the drawings account. You can put your own money in directly (as a transfer from drawings to the current account) or indirectly, as you have in this case by using personal funds to pay for a business expense.