I have taken on 2 unrelated clients from different accountants recently (both single director service companies) and was surprised to hear they have both been advised to ALWAYS pay for business expenses (travel etc) on their personal card and then claim it back from the company later.
To me that seems crazy as there's more scope for missing transactions and it adds unnecessary extra steps into the accounting process.
I am wondering why some accountants do this. I can think of 2 possible reasons:
- It is less work for them at year end as there is one expense line rather than several on bank statements each month
- They would rather put in over-inflated expense estimates rather than actual expense transactions (as seemed to be the case with client #1)
Any other thoughts? Am I missing something?!