Financing your business-your savings

lycane

If you lend money to your own company is it still classed as your savings? How to do that properly? The same with devices etc. What are the consequences, any costs etc?

Sandtree

Considered your savings for what purpose?

Technically what you have is a loan receivable not savings which may or may not be repaid depending on how your company goes. For certain benefits etc it may be seen as artificially depriving yourself just the same as giving gifts etc to your kids but I am not a benefits expert. 

As to devices, that tends to be a more informal process unless the "company use" will cause additional wear & tear... more often the company just pays for any consumables its using up (eg printer ink)

lycane

Considered your savings for what purpose?

Technically what you have is a loan receivable not savings which may or may not be repaid depending on how your company goes. For certain benefits etc it may be seen as artificially depriving yourself just the same as giving gifts etc to your kids but I am not a benefits expert. 

As to devices, that tends to be a more informal process unless the "company use" will cause additional wear & tear... more often the company just pays for any consumables its using up (eg printer ink)

It would be a loan for start up costs and making investments as well. Regarding devices I am talking about buying specifically for the company purpose as a private person but probably there are better ways of doing so. Are there any tax implications linked to the loan?

Sandtree

lycane said:
Are there any tax implications linked to the loan?

If you give the company £10,000 and expect the loan to be repaid as £10,000 no.

If you give the company £10,000 and want to charge 5% interest then yes... income tax has to be paid on the interest proportion of repayment

There can be issues if you expect to be paid interest at a rate well above what the company could have gotten from a commercial lender