If you are in business, or even if you work for someone and are reimbursed for your expenses, it’s important to understand the role of business credit cards and personal credit cards. They are two very different things and should be only be used for what they are meant for. Business expert Phillip Thow lays out the following different uses of business credit cards and personal credit cards depending on your business function.

If you work for a company and have are reimbursed for your expenses, the difference between business credit cards and personal credit cards is that your employer is responsible to pay you back whatever you charged to your personal card and you will have to keep good records. They will also get the tax benefits from the expenses charged to your personal card. You, however, do not. If you have a company credit card, you do not get reimbursed, and thus do not have to worry about getting paid back or keeping records. Having a business credit card in this situation is better for you as an individual according to the advice of Phillip Thow.

If you own your own business and have both business credit cards and personal credit cards, the scenario is a bit different. You may claim all business expenses from both cards, but be careful and don’t double dip! The IRS won’t like it much! Business owners should really keep all business expenses on their company card and avoid using personal credit cards for business related expenses, unless it is absolutely necessary. If you have just started a business, it may be that you have to use your personal credit card for a while until you build up business credit. Just remember this bit of advice from Phillip Thow, be sure to keep good records and always remember to pay yourself back promptly. Phillip Thow says to pay yourself just like you would a regular vendor. It is important to be well disciplined in keeping business credit cards and personal credit cards working the way they should. It’s easy to start intertwining the two, causing problems for you and your accountant, or bookkeeper. Time is money and the less time spent de-tangling your business credit cards and personal credit cards, the better! Keep all this together and according to expert Phillip Thow, you are on your way to great business and personal success.