What to Do When Personal Purchases Use Business Money
Personal purchases should normally be paid from a personal bank account or card.
However, mistakes happen. You may accidentally use the business card for groceries, clothing, a familypurchase, or another personal expense.
Do not delete or ignore the transaction. Record it clearly as a personal purchase rather than a normalbusiness cost.
You may also decide to repay the business, depending on the situation. Keep a record of both the originalpurchase and the repayment.
Repeated personal spending from the business account can make it difficult to understand the true cost ofoperating the business.
It may also create confusion when reviewing reports or preparing tax information.
To reduce mistakes:
Keep business and personal cards in different parts of your wallet
Use different card designs when possible
Check the payment method before completing a purchase
Review bank activity every week
The goal is not to pretend the transaction did not happen. The goal is to clearly show that the purchase was personal.
