using personal credit card for business

[swankypants69]

hi, just a quick question someone may be able to help me with

i have been using my personal credit card to pay business bills and purchase stock

is there anything wrong with this or am i within my rights to use my personal credit card for whatever i want?

i am paying it off in cash so am saving a fortune in banking cash charges and earning points on my credit card

cheers

 

[namjc]

Hi There,

In my personal experience there is nothing wrong with using your personal credit card.

The issue comes when HMRC will want you to prove with invoices ect every transaction for your business for tax purposes.

I am not expert when it comes to the bank charges but my best guess would be any bank interest you could claim back on the money you borrowed for the business.

The best thing to do would be to use the card purely for business purposes that way you wouldn't have to work out interest/charges as they would all relate to your business transactions and as a plus HMRC would much prefer you using this method than mixing personal and business usage.

Depends on your circumstances if you have different cards you can use but in answer to your question there is nothing wrong with it just not "best practice".


Hope that helps.

 

[stevo5678]

Not a problem at all and very common.

Just provide the supporting receipt/invoice in your business accounting records and claim it as a valid business expense.

If you do claim bank charges then you will need to account for only the business proportion (use a simple proportion calculation such as total charges x business exp/total exp).

Stephen Edwards ACCA - Chartered Certified Accountant

 

[ART Accounting]

No problem at all, if you are a limited company treat it as Directors Loan or if a sole trader then it's Capital Introduced.

As everyone else said, please do keep receipts though in case of a HMRC visit.

 

[mcjohn]

According to me personal credit cards can be relatively easy to obtain and convenient to use. And with a range of cheap deals offering introductory interest-free credit periods, it can be tempting to use them as a supplementary form of finance for your business.

 

[prepaidcard]

Hi
There is nothing wrong to use your personal credit card for your business purpose, The main thing is that both the credit card and business is yours.

 

[swankypants69]

thanks very much for all the helpful responses

this is a great forum!