Recording Business Loans

Business borrowing has three different parts: receiving loan proceeds, repaying principal, and paying interest. Trio Ledger's Loan workflow keeps those parts separate from ordinary business income and spending.

Receiving borrowed money

Open Add transaction, choose Loan, then choose Borrowed money. Enter the amount and date, select the bank or cash account where the proceeds were deposited, and choose the loan. If it is new borrowing, you can select Add new loan and give it a friendly name.

Borrowed money increases cash and also increases what the business owes. It is not business income.

If the loan already existed before you began using Trio Ledger, add it in Accounts as Already owed before Trio Ledger and enter its Starting Balance. Do not record old borrowing as a new transaction.

Making a loan payment

Choose Loan, then Made a loan payment. Enter the total payment, date, bank or cash account used, and loan being paid.

Trio Ledger asks whether you know how much of the payment was interest:

• If you know it, enter the interest amount. Trio Ledger records that part as Interest & finance charges and applies the remainder to loan principal.
• If you choose No / Not sure, Trio Ledger records the payment against the loan balance and marks the transaction Needs Review. Review it later when you know the interest amount.

Repaying principal reduces what the business owes; it is not an ordinary business expense. Interest may be a business expense. This Guide describes the bookkeeping workflow, not lending or tax advice.