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bigduckontax
bigduckontax, Accountant
Category: Tax
Satisfied Customers: 3811
Experience:  FCCA FCMA CGMA ACIS
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I'm looking to enter into a contract through a limited

Customer Question

Hi
I'm looking to enter into a contract through a limited company that I have just set up and which is incorporated. The contract should provide an income and requires an upfront payment.
The problem I have is that the bank have said it will take at least four weeks to get a business bank account set up, but I am hoping to sign this week. Can I pay from my own account (and if necessary receive income to my own bank account) and later (once the company bank account is set up) treat the payment and income received as payment and income of the company?
Submitted: 1 year ago.
Category: Tax
Expert:  bigduckontax replied 1 year ago.
Hello, I am Keith, one of experts on Just Answer, and pleased to be able to help you with your question. Apart from the rather smart Alec answer to try another bank I would submit that your proposals are perfectly right and proper providing, of course, that they are supported by appropriate vouchers. Frankly, for the moment, you cannot operate any other way. These days you cannot afford to let business go, in some cases it is as rare as hen's teeth! I do hope my reply has set your mind at rest. I do hope that my reply has been of assistance.
Customer: replied 1 year ago.
Thanks Keith. In terms of the right vouchers what would hmrc need to see? Is it enough that I pay from my account to the other contracting party or would I have to, having paid and then got the company account set up, put the company in funds and then pay myself back from those funds?Also (sorry, slightly separate question - by all means ignore if out of scope- is there a time prior to company set up that you can set off costs incurred in getting the business started)
Expert:  bigduckontax replied 1 year ago.
You are on the right lines. If you are buying something on the company's behalf obviously the invoice from the supplier or the bill of sale would support the position. If you are receiving moneys then have the company's copy of invoice to the customer prepared and ready. It is most unlikely that HMRC will be the slightest bit interested in the paper work unless they are making an investigation, an unlikely occurrence. What you are doing happens every day in business. There is no time limit, but a concept of reasonableness would apply. If you did it for a substantial period there is always a danger that HMRC will class it as self employment. Please be so kind as to rate me before you leave the Just Answer site.
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Expert:  bigduckontax replied 1 year ago.
Thank you for your support.

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