Problems
How do I separate personal and business expenses?
Short answer
Open a dedicated business bank account and card, pay yourself through salary, drawings or dividends, and record any personal spending on business accounts as owner drawings or a director's loan.
Detailed answer
Record the substance correctly
Separate bank accounts simplify evidence, but mixed transactions still need proper treatment. A personally paid business expense may create an amount owed to the owner; a private purchase from company funds may create a director or shareholder loan. Salary and dividends have separate legal and tax requirements and are not interchangeable with drawings.
Keep support for adjustments
Attach receipts, explain the business purpose and identify any private portion. Reimburse approved expenses through a documented process rather than netting them against sales. Have your adviser confirm the treatment for your entity type, particularly company loans, benefits and distributions that can create additional tax consequences.
Country differences: rules, thresholds and terminology differ between the US, UK, Australia and Canada. Check the official source for your country below.
Official sources
Published by Expert Bookkeeping Services · Last updated 2026-11-01. General information only — confirm specifics for your situation with a qualified adviser.
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