Paying yourself a salary

Why You Should Pay Yourself Salary as an Entrepreneur

Being an entrepreneur is no mean feat. This is especially so in Nigeria, where the system is deficient and you have to work twice as hard!

But, if you have travel on your bucket list, then you must pay yourself a monthly salary no matter how small. This is not just for accountability’s sake, but to help your visa application.

A monthly income, amongst other things, will convince the visa issuing officer that you are a legit business owner and you have strong ties to your country.

I know people who have been denied visas for this reason, therefore it is important that you do not make the same mistake.

You can pay yourself a salary in two ways. First is, the salary method which is the typical payment structure. You can also earn using the owner’s draw method. Here, you as the owner withdraws from the profit your business makes.

Still not convinced about paying yourself a salary? Here are a few reasons you should consider:

Other than having sufficient funds, it is extremely important that your money can be traced to a reliable source.  Paying yourself a salary indicates a commitment to your business; it shows that you are committed to ensuring the growth of your business.

Receiving your salary in a separate account from your business account helps you manage your personal finances, thus demonstrating that your finances are not only in order but that it can fund your travel expenses.

Paying yourself has some tax benefits. As an entrepreneur, paying your tax also further proves your claim that you are a resonsible and legitimate business owner.

As an entrepreneur, do you pay yourself a monthly salary?

Comments (2)

  1. Iprincess January 31, 2019
    • Oto Tom February 1, 2019

Leave a Comment!

This site uses Akismet to reduce spam. Learn how your comment data is processed.