Bob's my Uncle...

[Gloucestershire_Graduate]

My Uncle Bob is interested in investing some money into our new business for a stake of our profits.

Before he makes his final decision, he is looking to see our business plan and financial forecasts.

How do I demonstrate the distribution of 'wages', including his return, in the plan? The business is very cost efficient and the plan was for, after outgoing, me to take the final balance left as my wage, obviously giving 20% of it to my Uncle. Regular monthly wages etc are not needed, as we both have other jobs, we would just look to split the profits at the end of the first 12 months.

Is this how it works? If so, how do I show it in the financial forecast?

At the moment I my predicted incoming's, and my list of outgoings. Do I then just display the final amount and write beneath that there would be an 80%/20% distribution of this?

Thanks.

 

[Ashley_Price]

Rather than try and do it yourself and get it wrong, why not let your accountant do this for you? Then you know it will be correct.

I assume Bob wouldn't put money into a business without making sure all the relevant professional people/services are in place, like accountant, legal advisor, etc.

 

[Gloucestershire_Graduate]

I run this as a sole trader, it's a very casual business and I should be able to handle finances myself.

 

[Ashley_Price]

I run this as a sole trader, it's a very casual business and I should be able to handle finances myself.

To be frank, if you think that you're heading for disaster, especially based on the question you've asked above.

Unless you plan to keep yourself up to date with all the tax, NI and PAYE laws then you will soon find yourself in trouble.

So much better to get someone in right from the start who knows what they're doing.

Would you rather pay £1000 a year now or have a fine from HMRC down the line for ten times that amount?

 

[Gloucestershire_Graduate]

I don't think I explained things properly, I currently run a separate business and have been handling my own finances for two years, and everything has been by the book (my Father is an accountant).

Back to my business plan question......how should I display the profit distribution?

 

[stevon]

Ask yer dad

 

[Gloucestershire_Graduate]

He is Dubai for a month and I'm struggling.....I'm assuming nobody here has any advice?

 

[stevon]

Give him a phone, or an email? You're struggling, afterall...

 

[Cabal46]

Ask yer dad

LOL

An excellent website to find what you want...Google.com: 'tis yer friend

 

[Techy]

My aunty Fanny might offer you a better deal than uncle Bob :>

 

[Ashley_Price]

What you're asking for is an accountant who has trained for several years to give you free advice.