Processing Payment to Vendor from Imported Checking

[John Ralls]

To decode that for non-USA readers:

By “Sub S corp” Fran means https://en.wikipedia.org/wiki/S_corporation <https://en.wikipedia.org/wiki/S_corporation>.

Regards,
John Ralls

> On Feb 5, 2018, at 6:13 AM, Fran_3 via gnucash-user <gnucash-user at gnucash.org> wrote:
> 
> Maf,
> Thanks for the response and the info. In our case we are a small USA Sub S corp.
> I think I meant to say "distributions" and not "disbursements" ... so clearly no accountant here :-)
> Some info on USA Sub-S Corp's "distributions" here: Taking money out of an S corporation
> I think what we were looking for was how to account for a loan to a shareholder... and ended up putting it under Assets as it is money owed the business.
> Regardless, our use of gnuCash will be scrubbed at year end by a professional accounting firm... that said we want to be as close to 'correct' as possible :-)
> gnuCash is the next step in our accounting system process...
> 1 - left pocket, right pocket2 - paper and pencil3 - spreadsheets4 - gnuCash
> :-)
> I'm sure I will have more questions so thanks for the help all !
> Fran3
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> Taking money out of an S corporation
> 
> S corporation owners may take money out of the corporation in a variety of ways, such as in the form of wages an...
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>    On Sunday, February 4, 2018, 5:52:07 PM EST, Maf. King <maf at chilwell.net> wrote:  
> 
> On Sunday, 4 February 2018 20:39:02 GMT Fran_3 via gnucash-user wrote:
>>   Geert,
>> There are three ways (that I know of) for a shareholder or owner to get
>> money out of their business...1 - Pay themselves as an employee2 - Loan
>> themselves money3 - Discernment- which is like a "dividend" payment to
>> shareholders ( I think) But I'm no accountant... so someone else will
>> surely weigh in on this. When is gnuCash 3 going to be released?
> 
> Hi Fran,
> 
> I'm not an accountant (or lawyer) either, but I have to say that what you've 
> written isn't my understanding of (UK) corporate law. I don't know where you 
> are in the world, so the below may only be partially true for you.
> 
> 1. a shareholder of a ltd company can't take a wage unless they are also an 
> employee (directors are employees).  Often in small & family firms the 
> shareholders are directors, but the 2 roles are distinct & must not be 
> conflated.  If you're not clear about this, maybe talk to an accountant?
> 
> 2. A loan.  not really getting money out of the company, as it should be paid 
> back in due course.  there are (in the UK, at least) some pretty stringent 
> anti-tax avoidance rules around loans, too.  Record as something like 
> Asset:Bank:Current -> Asset:LoansGiven:JoeBloggs
> 
> 3.  IIRC, the term you want might be disbursement.  Yes, dividends are the 
> usual way shareholders get money from a ltd (or plc) company.  I record them 
> as transfers to Expenses:dividends. My accountant has never complained.
> 
> 4. you didn't mention selling shares.  Again, a tax & legal minefield where 
> professional advice is required.  But it is a way of getting money as a 
> shareholder.
> 
> Note. I don't download transactions, so I'm not sure about this "assign as 
> payment" workflow you talk about.  All my transactions are either entered 
> directly in the registers, or for bills / invoices through the "Process 
> Payment" buttons which are outlined in the docs.
> 
> 
> HTH,
> Maf.
> 
> 
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