Owner drawings

This explains how to record any money or assets you withdraw from your business for your personal use. This is known as owner drawings. This could be money, stock or machinery.

Owner drawings only apply to sole traders and partnerships. They do not apply to limited companies.

This is equivalent of the owner or business partner being paid.

How this works

  • For payments of money, enter as Other Payment. This is to make sure you record the money being paid out of the appropriate bank account.

  • For payments in stock or assets, enter this as a journal.

  • Use the special 3260 Drawings ledger account we have already set up for you.

  • If you are a partnership, we recommend that you create additional ledger accounts for each partner.

Create a ledger account for each partner

  1. From Settings , choose Business Settings.
  2. From the Financial Settings section, select Chart of Accounts.
  3. Select New .
  4. Enter the details of the
    1. Name - we suggest you use Drawings and the name of the partner.
    2. Nominal code - we recommend that you use consecutive a number from your Drawings such as 3261.
    3. Category - choose Equity.
    4. VAT rate - choose No Vat.
    5. Visibility - choose Other Payment.

Enter a money payment

Check the visibility

This is to make sure you can select the when entering the payment.

  1. From Settings , choose Business Settings.
  2. From the Financial Settings section, select Chart of Accounts.
  3. Select the row for the 3260 Drawings .
  4. Enter the details of the
  5. For the Visibility - choose Other Payment and Save.

Enter the payment from a bank feed

  1. Open your bank feed transactions page.

  2. Find the relevant payment.

  3. Choose Create.

  4. From the What drop down list, choose 3260 Drawings or the created for a partner.

  5. Select Create.

Enter as a new payment

  1. From Banking, open the required bank account.
  2. From New Entry, choose Purchase/ Payment, then Other Payment .
  3. Enter the details of the payment. Make sure you select
    1. Ledger account - choose 3260 Drawings or the ledger account created for a partner.
    2. VAT rate - choose No VAT.
  1. Click Save.

Enter a payment in stock or assets

For example, the owner has taken £25 worth of stock for their own personal use.

  1. From Journals, choose New Journal.
  2. Enter the Reference, Date and, if required, an additional Description.

  3. Enter the following details then click Save.

    Details Debit Credit Include on VAT Return?
    5000 - Cost of Sales Goods Owner drawings 0.00 25 Leave clear
    Drawings – equity (3260) Owner drawings 25 0.00 Leave clear

  4. If you reclaimed VAT on the purchase of the stock, you must include this in the journal. Enter the journal in the following way

    Details Debit Credit Include on VAT Return?
    5000 - Cost of Sales Goods Owner drawings 0.00 22.28 Leave clear
    2201 - VAT on Purchases Owner drawings 0.00 22.28 Leave clear
    Drawings – equity (3260) Owner drawings 25 0.00 Leave clear