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Can you loan money to your own small business by billing yourself and making a payment to it with your personal credit card? How would the accounting work on that? The business isn't actually billing you for a service, so the transaction shouldn't be taxable, and it shouldn't be treated as income either.

Edit: The small business is a single-member LLC incorporated in the USA.

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    Check your (the business's) contract with the credit card company to make sure this isn't fraud. A more straightforward solution would be for you (the individual) to take a cash advance from the credit card and invest it in the business as if it were cash (which of course it is).
    – The Photon
    Apr 1 '20 at 0:25
  • Just as a practical matter, there are probably many better - that is, lower interest - ways to borrow money.
    – jamesqf
    Apr 1 '20 at 16:22
  • @ThePhoton: Since the person Bladepoint wants to make a credit card payment, it's his personal credit card company that has to agree, not the businesses credit card company.
    – gnasher729
    Oct 17 '20 at 8:46
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This typically considered a form of credit card kiting. It is not allowed under the TOS of most (if not all) card processing/merchant account agreements. There can be legal consequences if intent to defraud can be proven, but typically it just results in account closure.

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    This doesn't sound like kiting. It's a one-off transaction, just a convenient way of moving funds. Apr 1 '20 at 12:57
  • @PeteBecker It's not what those accustomed to check-kiting would think of, but it's generating cash from credit that the user would not have access to in normal usage. Basically it's the first leg of the kite, if they did it again with a separate credit card to pay off the first it would fit more traditional definitions.
    – Hart CO
    Apr 1 '20 at 15:10
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If you want to give your company a loan, then just give your company a loan. Write a piece of paper, where you clearly state that you personally (Mr. Bladepoint) will give a loan to the company (Perfect Blades LLC or Ltd.), write down when the loan should be repaid, what the interest is, and hand over the money in any way you like. Your credit card company may not be happy with you giving loans to random companies using your credit card.

Make sure that you transfer the money in a way that is properly recorded, or the tax office will suspect tax evasion when the loan is repaid. (They will see a paper claiming a loan but no evidence of it, so they will suspect that the repayment is not a repayment, but extracting profits from the business).

"Billing yourself" is not a good idea at all. A bill leads to income for the company, which is pure profit if the company doesn't have any cost, so taxes will have to be paid. And the company cannot repay the loan, they have to give you a dividend payment which is again taxed.

Just do it straightforward, as a loan.

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