Hi,
I am the director of a Personal Services company and pay meals, accommodation and travel expenses etc with my personal credit card or cash from my personal bank account, and then claim it back from my limited company.
To reimburse myself, I usually transfer the money from my Business Bank account to my personal bank account, and my accountants issue me with a P11D which I include in my personal tax return to show this is a reimbursement and not an income. But this also involves some paperwork.
I have found another way - to pay expenses in cash I can also use by business bank account ATM card to withdraw money from an ATM, and use the cash to pay for the expenses. In this case the transaction directly reflects in my business bank account. There is no need to reimburse myself or any P11D.
I would like to ask if what is the difference between the two - is there any particular advantage of one over the other. I have seen most people use the former approach, but I find the latter approach more convenient, especially paying hotel bills which do not accept card payments. Is there any disadvantage in the latter approach (apart from bank charges).
A second related question - when paying by personal credit card, rather than transferring the money from business to personal bank account and issuing a P11d, what if I simply withdraw cash for an equivalent amount from my business bank account at the end of the year and pay the cash into my personal bank account.
Thanks
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