I've just been approached by a company director for help. They are a friend of a current client so am trying to help but this is out of my experience.
He has been a contractor for 6 years but also makes money from non-contract work and puts it all through his Ltd. He has paid himself nothing, not even submitted a self assessment as he said he isn't earning enough. He is in media and advertising so his expenses are very very broad but to be fair to him, farely legit.
The bookkeeping is very good in general, he uses Xero, keeps receipts, is vat registered, pays on time etc but has managed to make no profit every year. He spends it. If there is anything at year end, he will invest it in the business, buy inventory, fixed assets, an advertising campaign etc to spend the revenue.
Now he wants a mortgage as he got married. But doesn't know where to start. His wife is unable to work.
To me it sounds like he's at ground zero at best. No profit, no salary, no drawings. The business revenue is roughly £120k.
Anyone have any suggestions?