1st year losses

bloobuoy75

Hi guys,

I'm doing the accounts for a limited company who has made a loss in its first year of trading. The problem I have is that the director has paid himself £1700 in the year, but hasn't set the company up as an employer and therefore not done any payroll returns. Can I still show this as salary or should it be dividends even though directors aren't supposed to take dividends if the company has made a loss.

What do you guys recommend?

Cheers

Bloo

RAS

Looks probably like an overdrawn loan account, will need to be repaid within 9 months after the year end to avoid s.419 implications. Not sure if you have just taken on this client, but appropriate director remuneration planning should have discussed with the client well before the stage of preparing final accounts.