Can I take money out of the business bank account?
Yes - a sole trader can take money out of the business bank account as ‘personal drawings'
As a sole trader business structure, amounts taken from the business form part of your taxable income and must be declared. A separate business bank account is not compulsory or a legal requirement, but it’s recommended so you can keep track of your business finances. You may choose to use an existing bank account in your personal name for your business.
No - as a director, the company may pay you a salary, wages or director's fees, but you cannot simply withdraw money as ‘personal drawings’ from the company funds and use them for personal expenses. Company funds must be used for appropriate company purposes. Even if you own the company (as a shareholder), the money a company earns belongs to the company.
Anything you receive from the company as an individual, (for example, because you are employed as a director and being paid wages, or because you have received dividends as an individual shareholder) must be shown on your individual tax return.
As companies exist as a separate legal entity, they must have a separate bank account for the business. The company will be liable for bank fees, depending on the type of account it opens. Signatories are required for the bank account and must be over the age of 18.
Private companies that make tax-free distributions to shareholders or in the form of payments, loans or debts forgiven, have to adhere to Division 7A. Where the payments are made to a shareholder or associate (but not in their capacity as an employee or associate of an employee), the payments may be treated as assessable dividends.