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Some of the clients of my limited company agree to pay my mileage at 45p. This I invoice separately and understand that I have to regard this as sales income ie Dr Client, Cr Sales a/c - mileage. When my client settles - Dr Bank, Cr Client.
My problem is that a substantial amount has now built up on the Sales a/c and as I've paid for the fuel out of my own pocket I want it out!! I had always thought that mileage claims were not subject to tax (under certain thresholds) however by entering these invoices as 'sales' they become part of the company's taxable profits. As such I've got no idea what entries to make to get the balance out and into my hands (or pocket).
Any help would be much appreciated.
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