For a schedule C business, you and the business are one in the same. The easiest thing to do would be to simply pay the person as an employee of the business regardless of the work they were doing. For a schedule C business when you are the only owner, it doesn’t matter that you are paying them to also perform personal services.
If this is a partnership or this was some other kind of business where it was important to divide the profits between several owners, then the other owners might be annoyed if you were using company funds for personal services. But that is more of a business ethics issue than an income tax issue. If you want to pay the person separately for their personal service work, then they would probably be your household employee and you would need to issue a W-2 as a household employer for the personal services along with a separate W-2 for the business. Household employee tax is the employer share of Social Security and Medicare in this case. But it seems like a lot of trouble that you probably don’t need to go through.
