Director loan confusion,,,,business in profit

[adilzia]

hello guys
Can you please clarify my confusion?
Specially Zimba
you are very kind n helpful to everyone and very active member here in this forum.


We are 2 team members and our route is 200 k .

we are running 2 different fast food companies.And both companies are going well and generating good revenue and we are paying all expenses from turnover.and both companies are in profit from 1st year.
As well as we transfered 200k from personal acc to business accounts in small installments.And after that we withdraw this director loan from business account.But it shows in annual accounts (Director loan section).
Will it be a problem for us ?

Basically my question is that what HO concern ?
Are they concern with annual accounts (Director loan section)which shows 200k director loan and transactions are identifiable ? or they have concern with this aswell that where director loan money spent ? coz we have withdrawn the director loan amount from business account.Keep in mind both companies are in profit.And paying all expenses and wages from turnover.

Please advice me
thanks

[nasiaziz]

you shouldnt have withdrawn it back as that doesnt count as investment.
investment means once u put in the business account it stays there forever unless spent by the business
if the business is profit and cover all expenses then money stays in bank as cash assest of the company.
better you put the money back in the business account as soon as possible.
you could have spent the money on purchasing the equipments lease and all capital expenditures of the business if its a new business not possible you created a new business and the all or half of the anount of 200k is not used in purchasing equipment and stuff for the business.

[awan905]

Your 200k investment should only be consumed by business in terms of expenditure, if not then it should stay in business bank account. You can only withdraw money as a director salary or as a dividend on top 200k.
It is better if you put the money back in account and complete the 200k again and only take the excess amount.

[zimba]

Investment money should remain available to you until such time as it is spent for the purposes of your business or businesses.
You repay the loan when the money is all spent, when you can pay the loan back using profits.