When should a business owner be entitled to salary?

[Kelvin7656]

We have heard over time how in Nigeria, the employer is king. Though there has been a number of employees suing their employers, but the recent spike in law suits brought against their employers by employees has called this perception to question. This is a wake-up call for a lot of small business owners as it reminds them that when it comes to employees not only should everything be done but it should be seen to be done. In our present situation, where a lot of SMEs are really fiefdoms, lawsuits are on the rise as people realize that they have rights after all and are free to exercise those rights.

 

[Abiodun omolayo]

At the early stage of any business, profit won't be as expected, but as the business grows, then the profit will also appreciate, as a business owner you can start paying your self as soon as the business iw capable of paying you from the profit realized.

 

[Ridorz]

It's not a good idea to be taking a business profits and spend it for personal project at early stages of the business.
The best thing Is to be using a business profits back on a business in which to boost it and make it enlarge by growing up.

 

[Shigobad20201]

This is a very interesting topic, some employers are out there that treat their employee like slave , some even will be owing their employee 3month salary, they have the money but just decided not to pay , so its the duty of the employee to report such case to the law.

 

[Adetayo100]

You should only pay yourself out of your profits and not your revenue. When you see money coming into your business, don't assume you can pay yourself a big slice of that, you also need to take account of things like taxes, payroll, fixed costs and overheads.

 

[maventiger]

I quite agree with you, but not completely with all your statements. How do you mean steal? One can spend his or her profit after proper calculations have been made. It is normal to eat where you labour. Please keep that line in mind..

@MarieArie Proper calculations? like what and what do you consider when making such calculations. It is normal to eat where you labour no doubt, but you shouldn't kill the business at such an early age. A farmer who labour planting will at least wait for a period of time to harvest.

 

[Lawal]

With my little knowledge I think the business owner shouldnot be entitled to salary because he is the business owner if any profit com out of the business is he the one that will be collecting the money so why should he collect salary, is owned is that he should pay the employee

 

[Bkoks]

As for me, being a business owner should not exclude from payroll. If I own the business, I'll also be in payroll .I believe by that, I'll be able to cross check my spending, caution my self and I've also but my self under the law so as to have steady running of the business.
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As for me, being a business owner should not exclude from payroll. If I own the business, I'll also be in payroll .I believe by that, I'll be able to cross check my spending, caution my self and I've also but my self under the law so as to have steady running of the business.

 

[Princeeffiong]

You don't expect an entrepreneur not to derive benefits from his company. Yes, he has every right to earn little from the proceeds of his business as far as it doesn't affect the growth of the business negatively. You don't even have to call it salary, because it doesn't make sense. He can use a portion of the income at any time to finance any of his personal project that might tell directly or indirectly on the original business. An entrepreneur need to pay himself from the proceeds to avoind him spending money for unnecessary things

 

[eenya001]

This question is very tricky as to when a business owner is supposed to be paid or when he should pay himself, I believe the best time for a business owner to pay himself it's when the business is recording enough profit that is sustainable and the growth of the company is stable be it slow or fast.
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This question is very tricky as to when a business owner is supposed to be paid or when he should pay himself, I believe the best time for a business owner to pay himself it's when the business is recording enough profit that is sustainable and the growth of the company is stable be it slow or fast.

 

[Erik4150]

I won't call it a salary. The word income is better suited here. But you are right. A business owner should not be eating his income from the business unnecessarily until he is sure that the business is stable and will keep generating consistent cash flow.

 

[Ub40]

I may agree with some things you said from your analysis, but I want to disagree that when a business owner takes money from his business for some personal issues, that it is stealing. Me I don't see it as stealing. If he can do it and it doesn't affect the running of the business. Or will probably replace it later, without it affecting anything in the business, to me, it is ok. This is just my take.

 

[Ralphjoe]

A business owner is entitled to any amount of salary that he wants to pay himself but in a situation whereby the company is just a new business, then it will be advisable that he shouldn't take his salary but should reinvest it back into the business to drive the growth of the Business.

 

[Victor72]

I believe a business owner should be entitled to salary in his business this will help him control his spending and also it will help the business to grow faster, but the business owner who is not entitled to salary in his business will end up spending recklessly

 

[Setho]

Naturally, you are only supposed to eat from your profits and when a business is just starting out, profits are very hard and slow to come by so you should allow the business to reach a certain extent before you pit yourself on a regular salary.

 

[Adventurer]

This sounds funny. You don't expect an entrepreneur not to derive benefits from his company. Yes, he has every right to earn little from the proceeds of his business as far as it doesn't affect the growth of the business negatively. You don't even have to call it salary, because it doesn't make sense. He can use a portion of the income at any time to finance any of his personal project that might tell directly or indirectly on the original business.

I disagree with this, a business owner must be on a salary, if he needs extra money it should be taken out as a loan, no professional accountant or auditor will support this as it upsets the accounting system and makes it disorganized.

 

[Philip Omotayo]

I will say that for proper accountability and documentation and transparency, business owners should pay them salary or wages too. It is advisable for business owners to judge and justify themselves accurately so as to know how much they are gonna pay, this is important and needed.

 

[kayode10]

The business owner is the last person to receive payout from the business after everyone. The reason is that he is going to be the one to get paid most so he needs to exercise patience and not sure the princess to go big enough to pay him lifetime salary. The major focus of the business owner is to think of how to make it bigger and expand beyond the present situation. When that happens the business will mature enough to pay him whatever he wishes to get for himself.

 

[WhiteHouse]

Not at the early stage of the business when you just getting things started, before taking any money out for personal use the business should have been able to sustain itself and the amount you took won't affect the smooth running of the business.

 

[jay]

To me, a business owner taking out of the business earnings for personal projects at an early stage of the business is STEALING FROM THE BUSINESS.

A business owner who wants the business to grow won’t be tempted to use the business earnings for personal projects. The owner should be entitled to salary when the business is having steady cash flow.



Have you been stealing from your business?

When I do tell some that the fact business made cash to be on your hands doesn't mean it's telling you to spend it.
If you're to give yourself a salary from your business for project or self then you will have to draft how much you can save a day from the daily profit so that by the end of the month you can now put the saved money into the project.