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Currently there’s a promo for 40(60) and 80(120) thousands Avios via Amex business, however that I’m considering, however, there are limitations, namely denying it if there were any Amex Points cards (personal too) int he past. It also requires a hefty business spend. I run a small software dev company and I would struggle to spend 6k in Amex-eligible purchases as most of the company expenses are staff and we’ve done the bulk of our hardware/software purchasing this year.
I have two questions, and excuse me if that has been asked (search on the forum doesn’t work for me for some reason), however:
1. In the UK Directors can take out a Director’s Loan. It applies to credit card spending as well. Would i be able to use that to bolster my run to the £6k spend? Has anyone considered/tried that before?
2. Can I connect the Business and Personal Amex to the same BA account eventually? The plan is to rack up the welcome points, then get the voucher via Amex BA Platinum Plus and get lots of points + voucher. I assume that’s achievable, since the business card still connects to a personal BA account?Seems like a direct director’s loan would be treated as a cash advance and incur cash advance fees? Unless you’re just planning to do it via a string of personal purchases on the business card – which seems like a breach of terms – although thi sis very unlikely to be an issue – but also an accountancy mess that the accountant may charge you to sort out which would negate any benefit, so that’s one to check.
If you have trade accounts with regular suppliers (of the reliably solvent variety), why not overpay these and run a credit balance – I’m sure they’d be quite happy with the positive cashflow 🙂
Yes, both the Business card and a personal BAPP Amex feeding Avios into one account is fine.
Agree – it’s just a cash advance, so 3% fee and no points.
I am not recommending doing this as it would be a breach of your terms and conditions but…
Yes you could do what you would wish to do.
You can use your business card to buy whatever. Let’s say you’re doing a home refurb and you go to B&Q and drop £4,381.13 on a summerhouse.
You would pay off your business card using your business bank account. At this point you have created a director’s loan whereby you owe your company £4,381.13. You can repay your company this immediately or carry it as a balance which will then appear in your accounts. I cannot remember at what point there could be tax implications to this but repaying immediately would be fine. And I seem to remember under £5k is fine hut that could be loans to employees. I’m a very, very lapsed Charted Accountant.
Anyway, that’s you got a new summer house and almost hit your spend target.
As Rob has observed, if you look at the offers on business cards, they do not seem targeted to business e.g. Ann Summers is as likely as Viking.
Now the reasons not to do this are (1) business cards carry higher fees so you are doing over the shop to the tune of a percent or two (2) it’s against your terms and conditions although how would Amex know on a one-off spend versus, say, a weekly Tesco food shop (3) it’s all a bit messy and life is too short.
Would I do it? Nope. Despite the attractions I haven’t taken out an Amex for my company. Can you? Sure.
Yes you can do this for personal purchases. There are issues if you go into the end of your company year with too big a loan however.
You could also pay company bills through billhop and put them on the Amex that way. You will incur something like a 2.95% charge for this, though this would be a business expense.
One thing which I may not have understood or maybe is not a scenario wanted, is that the Business Cards, although associated to the business, are in fact entirely the personal liability of the cardholder and as such can be used for personal purchases as far clear bookkeeping is kept about this, even without creating a Director Loan as such and paying the portion of personal spend via Salary reduction, paying into the company or paying directly the card (on this however I believe Amex has recently taken a negative view on). For reference I have in the past held Corporate cards by FTSE100 company, and we could use the same card for personal spend: there was the functionality to mark the transaction on the statement that were personal and chose to make direct payments into the account or salary reduction.
Thanks for the insight everyone, makes perfect sense and it’s good to learn that this has been reviewed and. It’s Under £10k per year without implications now.
Certainly wouldn’t want to be in breach right out of the gate and appreciate the answers!And special thanks to KevinC for an outstanding shout about Billhop. I could pay some of the company’s goods & services in the coming months, spending £180 in fees to get 40k MR points, which far outweighs the commission on the service.
Was wondering about the £200 Amex Travel credit – is that redeemable on personal flights, or would that be classed as something taxable and thus should be kept for business purposes?
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