I have a question which I require answer on behalf of my client.
A person who is director of the company and had withdrow cash from company's bank account for personal use over the period of 2 years.
He said that these payments are in return of services he provide's to company.
His total cash outlay come to £22,000 in last 2 accounting years of the company (2011 and 2012).
Company has made trading loss during the year and accounts are yet to submit to company house.
He is sole director of the company but there is a management committee who control the business affairs. Management committee allowed him to take payments in this form.
He is submitting invoices to company's account regularly.
He provide services to other companies and get paid from them as well.
My question is, what will be treatment of these payments?