On 12/1/2024 1:58 PM, Grace wrote:
My situation is that I have personal accounts (CAD), a small business
account (USD) and some trading accounts (CAD and USD).
I think I already know the answer, but is it possible to have a
transaction across any two of the separate files, i.e. pay salary from
the small business account file to the personal account file.
Presuming that it is not possible, I would need to have all three in
one file. Which hierarchy would work best? Opinions on a post card
please!! :)
First of all, the small business, does IT have its own set of books? <<
yes I know, you are its sole owner, but that does NOT mean it can't have
its own set of books and be an investment in your personal set of books.
One advantage of having its own set of books is that you can show those
(to a prospective buyer, etc.) without showing your personal books.
Salary? Terminology maybe. When you are the sole owner usually a
"drawing" but let's let that slide. You have been ignoring EQUITY (and
people have been asking what equity is for). So let's say that small
business is paying its manager (you) a salary. In the business books
that would be a debit to expense;salary and a credit to asset:checking.
In YOUR (personal) books a debit to asset;checking (your personal bank
account) and a credit to income:salary.
BUT -- here you need to consult the tax rules for your jurisdiction, and
I would certainly get professional advice. Do you even have a choice?
(treat as salary or drawing) How does that affect your taxes, the
business's, yours, etc.
Michael D Novack
PS: If a "drawing", in the business books, not an expense, just the
owner taking money out of the business. So debit owner's equity (just
equity if no other owner) and credit checking. In your books, debit
checking and credit asset:business. Again consult with professionals
from your jurisdiction, but here in the US your income (from the
business, for tax purposes, if not a corporation) is NOT because you
took money out but will be based on the business's profit/loss. In other
words, here in the US, if I am sole owner of a business (not
incorporated) and the business made $50,000 I will be reporting that on
schedule c, GOING TO BE my INCOME << EVEN IF I DIDN'T TAKE A PENNY OF
IT. >>
_______________________________________________
gnucash-user mailing list
gnucash-user@gnucash.org
To update your subscription preferences or to unsubscribe:
https://lists.gnucash.org/mailman/listinfo/gnucash-user
-----
Please remember to CC this list on all your replies.
You can do this by using Reply-To-List or Reply-All.
