Do you use business money for private purposes?

If you use money or assets from your company or trust for private purposes, it’s important to consider there may be tax consequences.

This applies for business money and assets such as:

• salary, wages and director’s fees
• fringe benefits and allowances
• company dividends or trust distributions
• loans of money or assets from a company or trust.

To ensure you get it right, take these 2 simple steps:

• keep accurate records to account for these transactions
• if necessary, account for the transactions in the company or trust’s tax return and your individual tax return.

By following these steps and keeping your business and private transactions separate and visible, you’ll avoid unintended tax consequences.

Remember, there are different reporting and record-keeping requirements for each type of transaction, so make sure you know how to keep accurate records for your circumstances when using your business money and assets for private purposes.

If in doubt, speak to our tax professional.

Source: ATO