Hi,
In a business partnership where a married couple run a business as well, if for example the company makes 90,000 and partner A wants to take 30,000, Partner B take 30,000 and they want to leave 30,000 to invest in the business. What way does it work for them to take the money.
Is it scenario X or Y?
Scenario X where drawing are deducted as expenses
Money earned 90,000
Drawings for A - 30,000 >>A then goes and pays tax on this himself
Drawings for B - 30,000 >>B then goes and pays tax on this herself
-----------
30,000 left to invest and tax is paid on this
or is it scenario Y
Money earned 90,0000 >> tax paid on all this amount... A and B take their money and the rest is left in bank account
------------
Sorry if this isn't clear.. i will be talking to an accountant about it, but I wanted to get some idea before I met him.
In a business partnership where a married couple run a business as well, if for example the company makes 90,000 and partner A wants to take 30,000, Partner B take 30,000 and they want to leave 30,000 to invest in the business. What way does it work for them to take the money.
Is it scenario X or Y?
Scenario X where drawing are deducted as expenses
Money earned 90,000
Drawings for A - 30,000 >>A then goes and pays tax on this himself
Drawings for B - 30,000 >>B then goes and pays tax on this herself
-----------
30,000 left to invest and tax is paid on this
or is it scenario Y
Money earned 90,0000 >> tax paid on all this amount... A and B take their money and the rest is left in bank account
------------
Sorry if this isn't clear.. i will be talking to an accountant about it, but I wanted to get some idea before I met him.