Should You Pay Yourself As A Business Owner?

Sikapa

Verified member
Let's say you are a business man or a business woman And at the same time you are the CEO and manager of your business. You also have a lot of employees working in your business which you pay them at the end of the month.

Is it advisable to pay yourself at the end of the month in your own business or you wait to see the profit? I need your opinions here here because this was a debate that took place earlier today and we did not get into conclusions so I want to know your opinions to conclude this debate.
 

Jasz

VIP Contributor
Self-employed business owners are often tempted to save money by paying themselves less than they are worth. But if you aren't careful, that can backfire. The reason is simple: When you pay yourself too little, your business expenses exceed income, and it becomes harder to make payroll. This could leave you in a situation where you have more debt than business cash flow and no way to pay down the debt. And if you're struggling with debt, then it's unlikely that your customers will be able to pay their bills either.

So what should you do? The answer is simple: Pay yourself what you're worth!
This doesn't mean that businesses need to pay themselves huge salaries or bonuses every year — but it does mean that they should treat their employees like any other expense in their business plan. If you work you get paid. And what is the essence of working and not getting paid? In short, paying yourself will let you checkmate yourself on how you spend inflow from your business, you. You get disciplined on how you spend your company's returns.
 
As a business owner, you may be wondering if you should pay yourself. After all, you are the one who started the company and you are the one who is making it grow. So why not take all the profits for yourself?

However, there are a few things to consider before you make this decision. First, you need to think about the long-term sustainability of your business. If you take all the profits for yourself, you may not have enough money to invest back into your business to keep it growing. Second, you need to think about your employees. If you don't pay yourself, you may not be able to pay your employees, which can lead to morale issues.

Ultimately, the decision of whether or not to pay yourself as a business owner is up to you. There is no right or wrong answer, but you should weigh the pros and cons before making a decision.
 

Mika

VIP Contributor
I own a small business. I sell through eCommerce marketplaces. Every day I work 3-4 hours on my business. Do I give a salary to myself? Well, no. I take the profits and don't give myself a salary. As a sole propriety business owner, all investment is mine, therefore, all profits and losses are mines. Therefore, I don't have to treat myself with a salary. My business is work from home business, I do not hire people to work on my business, when I need extra hands, I hire virtual assistants, but that happens occasionally. By business is not even a legal entity, it s not registered. However, if I was operating a registered business where I had to pay tax and audit my business, I would certainly give myself salary because law tells you you cannot work for free, you need salary if you are employed in a company, even if you work part time.
 

anil02

Verified member
Let's say you are a business man or a business woman And at the same time you are the CEO and manager of your business. You also have a lot of employees working in your business which you pay them at the end of the month.

Is it advisable to pay yourself at the end of the month in your own business or you wait to see the profit? I need your opinions here here because this was a debate that took place earlier today and we did not get into conclusions so I want to know your opinions to conclude this debate.
In my country only salary to director of companies is allowed but a owner or partner of firm can't pay salary to them self, if they are drawing money for expenses than it is not business expenses and it is taxable .
 
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