Industry sector: Transport

Limousine hire: Payments to creditors

When you buy supplies or services on account instead of paying cash there and then, your suppliers are your creditors until you pay them. Enter in your cash flow forecast the payments that you will make to your creditors (including VAT) in the months in which you will pay them.

As your purchases of fuel are likely to be substantial and made on a regular basis, you might try to set up an account with a local filling station, from whom you'll buy most of your fuel and who will invoice you monthly.

Setting up an account

To set up an account you may be asked to provide bank and trade references. Until the account facility has been granted you will have to pay for your order at the time you place it. This is known as paying on a pro forma basis.

Once your account has been set up you will be invoiced at regular intervals and expected to pay within a certain number of days of receiving the invoice.

Make sure that you keep the invoices for your records.