I am hoping someone here can help me out. I have already tried searching but cannot find anything that matches my question exactly.
I lent money from my personal account to my small business with no interest. Basically, my business received "free" money from me. This is to allow my business to buy needed equipment.
The intention was for my business to pay this off slowly, when the business earns. This doesn't necessarily need to be paid within the financial year.
I do this when I need to buy personal stuff which I pay back slowly, instead from borrowing from a bank and paying interest.
First question is how should I treat this "free" money and set it up in my books.
Then, how should I treat the payments back to my personal account. Can this be considered as an expense for the company? The company is basically just reimbursing me back the money.
I'd really appreciate if anyone can help me out.
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