When you’re an owner, a shareholder, or director of a company, it’s easy to blur the lines between your company as a “separate legal entity” and yourself as a person. It’s important to remember that company money cannot be used flippantly for personal transactions, as the funds belong to the company, not you.
The Australian Tax Office requires that all company transactions are recorded and declared. It is not illegal to use company money for personal reasons, however, it’s important to make the distinction and keep all records. There are many ways that you can report these transactions, including dividends, fringe benefits, and salary payments.
For more information, read this article from the ATO Small Business Newsroom.
If you’re not sure whether you’re correctly keeping your records and reporting transactions correctly, get in touch with us to straighten things out.