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Hi David
This is typical of new businesses but not really a problem other than getting your head around all the transactions. It will take you more time and cost your client more; I would just ensure he is aware that if his record keeping improved you could reduce your cost.
As it’s a new business he’s probably using his personal account because that is where the cash is! Or to avoid business banking charges (who can blame him!). To keep things ‘clean’ you could ask him to transfer cash to his business bank account to pay for all the business expenses and bring this lump sum in as capital introduced through the accounts. Otherwise I wouldn’t worry too much about using his personal account to purchase business expenses if he is a sole trader. Just ensure he keeps the receipts and bring the expenses in through capital introduced individually/grouped per statement.
As mentioned above post any personal transactions paid via the business account as drawings, however remind him that taking lots of drawings in this way can jeopardise the grant of loan facilities he may need in the future if the bank thinks he is taking more capital out of the business than is being created or personally introduced.
The allowance is taxable as personal income and must be shown on his SATR but does not need to be brought into his accounts. If he continues to get this paid into his business account just bring it in as capital introduced.
Best regards
Georgina
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