I am trading as a sole trader. I am waiting for my business account to be set up with the bank so at the moment all payments I am making for purchases are coming from my personal account. I am recording purchase invoices as invoices come in but how do I pay them or mark them paid i.e. what account should I show the money coming from to pay them?
Enter transactions like these as expense claims. See the Guide at Manager Cloud. Allocate the transaction to the same account you would if paying from a company account. If you have a capital account, you are automatically set up as an expense claim payer. If not, create yourself as an expense claim payer under Settings before entering the expense claim.
The expense claim creates a liability in Manager. You can clear this using Spend Money when your company bank account is set up, paying yourself back. Or you can use a journal entry to transfer the liability to owner’s equity or your capital account, depending on your exact chart of accounts. When you pay company expenses from personal funds, that is equivalent to a contribution of additional capital.
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