Cashflow/director's loan - help!

[antiquesdealer]

I know I should know this already but could do with some advice. I have a main occupation but set up part time as a sole trader dealing in antiques. It started organically buying one piece, making a profit and went from there. I registered for tax within three months but had to invest my own money to buy stock. I don't have a business overdraft. I sell through an antiques centre and pay rent each month.

If all of my money is tied up in stock I sometimes have to use my own money to buy a piece that is too good to miss say, £300, and when cash comes in from a sale, repay that money. Is this a director's loan and is this ok? I don't take any drawings and invest everything back into the business.

Sometimes, if I buy something using my own money, say stationery or materials for restoration, I don't always take the money out of the business. As I am trying to build up, I don't want to keep taking out. I only turned over around 10k last year - this is a fledgling part time business- but margins can be tight so I want to build this up over a couple of years before I take anything out but I can't afford to fund it all the time in terms of buying bigger pieces of stock.

It may be ad hoc the way I take money back that I have paid out of my own - say paid £300, take £200 back when cash comes in, and leave £100 owing but keep a full receipted list.

Am I doing anything wrong with this? I'm sorry if this sounds stupid and basic but I could do with some advice


Thanks

[Scalloway]

There is no problem with doing this, just make sure you have receipts for it and record the transactions in your books.

[Stovin]

You should, pay money into your business as a directors loan and then buy from the business. You shouldn't really buy anything for the business out of your personal money. I do it all the time to and forget to write down all my business milage. But you should

[kulture]

You should, pay money into your business as a directors loan and then buy from the business. You shouldn't really buy anything for the business out of your personal money. I do it all the time to and forget to write down all my business milage. But you should

For a ltd company yes, but the op is a sole trader.

[samanthaZ]

For a ltd company yes, but the op is a sole trader.

Agree with Kulture, as a sole trader, you may put in or take money as your own as long as you keep clear records and make sure you declare every transaction in your year end accounts.