Recording Transfers Between Accounts

A transfer records money moving between accounts you control. Transfers don't affect your tax calculation — they're internal movements, not income or expenses.

This guide explains when to use transfers, when they're optional, and how to record them in Provestor.

What is a transfer?

A transfer is money moving between accounts that belong to you or your property business. Because the money stays within your control, it's not taxable income or an allowable expense.

Provestor excludes transfers from your quarterly updates and final declaration. They only affect your account balances.

Common examples:

  • Moving money from your business current account to a business savings account
  • Transferring funds from your personal account to your business account
  • Drawing money from your business account to your personal account (drawings)
  • Net payments you receive from your letting agent

When to use transfers

Use transfers when money moves between accounts you control, rather than being received from a tenant or paid to a supplier.

Transfers between your own business accounts

If you move money from one business account to another (e.g. current account to savings), record it as a transfer.

Why: This isn't income or an expense. It's just repositioning funds within your business.

Drawings (business to personal account)

When you transfer money from your property business account to your personal account, this is a drawing. Record it as a transfer out of your business account.

Why: Taking money out of your business isn't a business expense. It's your profit, which will be taxed based on your total rental income minus allowable expenses.

Net payments from letting agents

If you use a letting agent, they typically collect rent, deduct their fees and expenses, then pay you the remaining balance.

For Making Tax Digital, you need to record the full breakdown of income and expenses from your agent's statement — not just the net payment you receive.

Once you've recorded the full income and expenses from the statement, the net payment itself doesn't need to be recorded as income or an expense — that would double-count it. You can either record it as a transfer to track the money movement, or leave it out entirely if you're not tracking account balances.

For detailed guidance on working with letting agent statements, see Recording from agent statements.

When transfers are optional

If you don't have a dedicated business bank account and you're not tracking account balances, you can skip transfers altogether.

Why you might not need transfers:

If you use a single cash account in Provestor and only record property-related income and expenses as they occur, there's no need to track internal movements. You're just capturing the transactions that affect your tax return.

For more on account types and when to use them, see Managing bank accounts.

Why you might want to use transfers:

If you have a dedicated business bank account and you want to maintain an accurate rolling balance in Provestor, you need to record all transactions — including transfers.

Recording transfers ensures your Provestor balance matches your actual bank balance, which helps with reconciliation and confirms you haven't missed any income or expenses.

How to add a transfer

To record a transfer in Provestor:

  1. In your business workspace, open the account the money is moving from (or into)
  2. Choose Add transfer
  3. Enter the details:
    • Date — The date the transfer happened
    • Description — A brief note (e.g. "Transfer to savings" or "Drawings")
    • Amount — The amount transferred
    • Direction — Whether the money is coming in or going out of this account
    • To/From account (optional) — The account you're transferring to or from

If you select a to/from account, Provestor automatically creates a matching transfer in the other account. For example, if you record a £1,000 transfer out of your current account to your savings account, Provestor will create a £1,000 transfer into your savings account.

You don't have to link accounts. If you're recording a drawing from your business account to your personal account, you can leave the "to account" field empty. Provestor will record the transfer out of your business account without creating an entry in your personal account (which you probably don't track in Provestor anyway).

Transfers vs. income and expenses

It's important to distinguish between transfers and actual income or expenses.

Use a transfer when:

  • Money moves between accounts you control
  • The transaction doesn't involve a tenant, supplier, or third party
  • The money isn't entering or leaving your property business

Use income or expense when:

  • You receive rent from a tenant
  • You pay a supplier for goods or services
  • Money enters or leaves your property business from an external source

Common mistake: Recording a supplier payment as a transfer because the description says "transfer" or "payment."

If you're paying a builder for repairs, that's an expense — even if your bank labels it as a "transfer" or "payment." The key is whether the money is leaving your business and going to someone else.

Handling imported transfers from bank statements

When you upload a bank statement, Provestor's AI may miscategorise transfers as income or expenses.

Bank descriptions often don't make it clear whether a transaction is:

  • A transfer to another account you own (not taxable)
  • A payment to a supplier (allowable expense)

If the AI incorrectly categorises a transfer:

  1. Delete the transaction during your review
  2. Use Add transfer to record it correctly

For detailed guidance on reviewing imported transactions, see Uploading bank statements.

PreviousUploading Receipts
NextJoint Ownership Properties

Was this helpful?