This guide is specifically for Sole Traders who operate a separate business bank account. If this is not you, then you can ignore this guide completely—the option to record a Drawings payment will not be visible in Joy Pilot.
Operating as a sole trader is different from running a limited company, especially when it comes to managing personal payments and drawings. Sole traders can take money out of the business freely, but it still needs to be recorded correctly.
If you’re transitioning from using one personal account for everything to a dedicated business bank account, managing Drawings payments becomes a key step in staying organised. Joy Pilot simplifies this by letting you categorise these transactions clearly and confidently making it easy to track these payments in your accounts.
In this guide, we’ll walk you through how to manage your drawings, expense reimbursements, and personal loans effectively. These simple steps will help keep your records clean, compliant, and up-to-date—no matter where you’re working from.
💡 If you're a Limited Company:
This guide is designed specifically for you:
Properly managing income and payments gives you clear insights into your business’s performance and financial position. As a sole trader, it’s essential to keep detailed records of:
Money received (income from customers)
Money paid out (business expenses)
Money withdrawn for personal use (Drawings)
💡 Note: In this context, Drawings refers to money you transfer from your business account to your personal account for personal use.
This is not a business expense or income—it’s recorded as Drawings, which is the correct accounting term for sole traders. It reflects a withdrawal of funds from the business by the owner, and does not affect your profit.
If you need to add a bank account before entering a Drawings payment, please visit our guide here.
Initially, if you're operating without a separate business bank account, your personal account handles both personal and business transactions. In this setup, Drawings payments aren’t recorded separately. However, once you have a business account, you’ll want to track any personal withdrawals—this is where Drawings come in, and Joy Pilot helps you do that smoothly.
Step-by-step Guide to Managing Drawings
Step 1. Enable Banking Reconciliation:
Navigate to your profile menu by clicking on your name at the top right corner.
Select 'Business Info'.
Find the 'Banking Reconciliation' option and switch it from ‘Off’ to ‘Enabled’. This activates features for managing a separate business bank account.
Step 2. Recording Drawings:
Go to the 'Business' dropdown menu on the top grey menu bar.
Click on 'Drawings'. Here, you'll manage the transfer of funds to your personal account.
Select the business bank account from which the funds will be drawn.
Choose the type of payment. Options include:
Drawings: Withdrawing earnings from your business.
Expense reimbursement: Compensating for business expenses paid from personal funds.
Loan from the business: When taking a personal loan of funds from the business.
Step 3. Pay Yourself:
Navigate down to the ‘Add New Drawings’ panel.
Fill in the required details:
Bank Account: Choose the bank account from which the funds will be paid.
Date: Specify the date of the payment.
Recipient (Paid To): Enter the name of the person or entity receiving the payment.
Payment Type: Select the type of payment (for further clarification see section "Types of Take-Home Payments" below).
Amount: Enter the payment amount.
Click ‘Save’ to record this payment.
Step 4. Editing and Deleting Payments:
The payment you've just added will appear in the ‘Drawings List’ which is below the section where you add a new payment. Here you can:
Sort: Organize the list by date, recipient, type of payment, or amount by clicking on the respective column headers.
Edit: If you need to amend any details, click the ‘Edit’ button next to the payment, make the necessary changes, and then click ‘Save’ to update.
Delete: To remove a payment, click the ‘Delete’ button next to the relevant record.
Step 5. Search and Export:
Utilise the 'Find' button to search your drawings list based on various criteria like date or amount.
Easily export your drawings by simply clicking the blue 'Export Tools' button located on the right-hand side of the drawings list area to download your data in various formats.
Tips for Efficiency and Accuracy:
Record drawings and expenses promptly to minimise forgetting transactions or details later.
Clearly describe each transaction for easy identification during reconciliations and reporting.
Regularly reconcile your bank and cash accounts to catch discrepancies.
Summary
Transitioning to a separate business bank account offers clearer financial management for sole traders. By following these steps, you can efficiently manage your earnings, ensuring a smooth flow between your business and personal finances. Should there be any questions, or you wish to explore more features, the Joy Pilot team is here to assist, empowering you to focus on growing your business with confidence.
Need help on other topics? Here are some useful guides:
Understanding Cash and Bank Reconciliations