Owner money and loans
Record money you put into the business, money you took out for yourself, and loans received or repaid, straight from the bank line.
Some money moving through the business account is neither income nor an expense. Money you put in from your own pocket is an owner contribution. Money you take out for yourself is an owner draw (in a sole proprietorship, this is how you pay yourself). A loan coming in is money you owe back, and a loan payment reduces what you owe. Categorising these lines keeps them out of your profit and puts them in the right place on your balance sheet.
Step by step
- In the menu on the left, choose Banking.
- Find the line in Transactions and choose Match.
- In the Match Transaction window, choose the Categorise tab.
- In This Line Is, choose what the line is. The line under it explains each choice.
- Choose Save. A "Saved" message appears, the line shows as Matched, and the line under its description says what you chose.
The choices
| Owner contribution (deposits) | Money you put into the business. It shows on the balance sheet under Owner's Contributions. |
|---|---|
| Owner draw (withdrawals) | Money you took out of the business for yourself. It shows on the balance sheet under Owner's Drawings. It is not an expense, so it does not lower your profit. |
| Loan received (deposits) | Money lent to the business, for example by a bank or a family member. It shows on the balance sheet under Loans Payable. |
| Loan repayment (withdrawals) | A payment back on a loan. It reduces Loans Payable by the whole amount of the payment. |
| Card payout (deposits) | Stripe paying out card payments. See "Card payouts from Stripe". |
Changing your mind
Choose More actions → Unmatch on the line. It goes back to Unmatched and the balance sheet no longer includes it.
Tip: If a loan payment includes interest and you know the split, record the interest as a bill (category such as interest or bank charges) and ask your bookkeeper to adjust the loan balance with a journal entry. Interest is an expense; the rest of the payment is not.
Good to know: If you use Partner Distributions to record partner draws and contributions, record each one in only one place: either there, or by categorising the bank line here. Recording it in both counts it twice on the balance sheet.
Starting out: money and loans from before Todah
Categorise only the bank lines you bring into Todah. What the owners had put in before your start date goes in the Owner's Contributions box of Enter Opening Balances (Journal Entries), and a loan you already owed on that day goes in with a journal entry to 2500 Loans Payable. Repayments that arrive in Banking afterwards are then categorised as Loan repayment and bring that balance down. Enter each amount once: a contribution or loan that shows up as a bank line is categorised here, never also entered as a journal entry.
See also
Was this helpful?
Still stuck? Write to us or email support@todah.ca — a person reads every message and replies by email. The FAQ covers plans, prices and the questions people ask before they sign up.