Martins Budgeting Excel Spreadsheet

dottyanne

Hi, ok am S/Employed and OH works for me, done a budget and if is pay him what i already do and take £150 per week myself then i can afford all bills/debts - thats the goods news.......

However:-

A. Dont know if/how the business will manage to pay me this (only time will tell i suppose).

B. What to do about the arrears i already have.....

If i pay myself as above then there is a monthly surplus of about £140.00.....

I have personal and business arrears - any advice please??

southernscouser

Hope this doesn't sound too harsh BUT clearly your business isn't profitable enough for you to earn a living!

Is it worth all the effort to only find yourself getting deeper into debt?

Chortle_2

I'm with SS on this one.

You'e got 2 completely seperate problems here, and you seem to insist on treating them as one issue. You have what appears to me to be a business which is struggling to break even, much less make a profit. And you have personal debt.

If you are determined to make a go of this business, it clearly CANNOT afford to pay you both. It hasn't been so far, and already it can't even meet its tax bills! For this business to work, it needs to turnover enough to cover all of its monthly bills, rent, rates, wages, PAYE tax & NI, suppliers, utilities - everything. Paying you has to come last I'm afraid. The situation you're in with it now, makes it even less of a priority to pay you, as it will have to find the money to pay its arrears too. Thats the business paying them - NOT you. They need to be gone before you even think of taking a wage on top of what the business is paying OH.
I'm concerned that you don't even know how much you turnover each month, let alone whether you are making a profit or not. Do you use any kind of accounting package at all? If not, use Quickbooks by intuit. Its relatively cheap (compared to most business packages) and VERY easy to use. Amongst other things, it'll handle all your payroll, including PAYE, VAT, and will show you at the click of a button whether or not you are making any money. With businesses, it is not simply a case of the money being in the bank, therefore there is enough to pay you - your wages should come out of profit, and that doesn't necessarily equal money in the bank.

I don't mean to sound rude, but how much do you and OH actually know about running a business? There are loads of books in the library about it, it might be a good idea for you to have a look, as I really think they would help you. Business accounts do not work anything like personal accounts, and even if you pay an accountant to do the big stuff for you, you need to know the basics (cashflow/accruals/how to do a basic P&L and balance sheet etc) otherwise you'll never know where you are, or if the business is viable.

Is the business a ltd company? Are you paying OH as an employee, or in drawings/dividends? Drawings/dividends would limit the amount of income tax/NI he pays, so could possible save you some money, both in the business, and in terms of how much he brings home. But if the business is solely in your name, you can't do that.

Any extra money for your PERSONAL debt will have to be found from an income from outside the business, at least for a while. Otherwise, this business WILL fold, and you'll lose OH wages, let alone any you might one day hope to get from it!

I don't think that you'll be able to untangle yourselves from this, until you seperate the business accounts from your own in your own minds.