Hi
I may be being a little dim here, I occasionally sub contract & I'm having a hard time getting my head round why CIS deductions should go to the, Owners drawings account, in my mind it is going to HMRC & therefore a tax payment perhaps you could explain?
Hi Neil,
When you are self-employed (not a limited company) the tax and national insurance you pay is considered a personal expense, not a business expense. The effect on the accounts is the same as if your customer had agreed to pay your son's school tuition fees instead of paying the invoice. - it is treated as a withdrawal of funds from the business by the owner.
Regards
