At what point when you start a small business should you be paying yourself expenses?

Question

Basically, with a small business starting out, should you be paying yourself expenses (travel, food etc) as it is taking money away from the business itself, meaning less money for other things.

! · Accepted Answer

Be careful what you claim. Food isn't usually tax deductible (you'd have to eat whether or not you were running a business) and travel must be demonstrably purely on a business need basis.

Legitimate expenses should be recorded from the outset whether or not you actually pay yourself the cash - you can deduct them from your taxable profit.

Anonymous · Answer

Since travel, food, etc is going to come out of the small business owner's pocket anyhow, wouldn't it be better to claim that as an expense immediately for tax purposes?

Tavy · Answer

You start by taking a small wage. Food and travel are not tax deductable, so cannot be claimed as expenses. Perhaps a word with an Accountant would help.
UK

Chris B · Answer

You should keep a record of your legitimate expenses and pay yourself back when and if you ever make any money from the business.  You must sacrifice some of the inconvenience in order to keep your business afloat.

At what point when you start a small business should you be paying yourself expenses?

4 Answers