Benefit in Kind or Draw down on directors loan account

Benefit in Kind or Draw down on directors loan...

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The Director of a Company uses the Company’s telephone (invoiced to the company) to make private calls. These private calls amount to 40% of the total telephone costs. The full costs of the calls is included within the Company’s accounts, but presumably, even though the phone bill is in the Company name, the Company is still paying a private liability of the Director, so there should be a BIK?

The Director has a substantial loan account however so could we not instead restrict the charge in the Company accounts to 60% and treat the balance as a draw down on his loan account

Any advice gratefully received.

SP

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By NeilW
19th Jun 2007 11:23

Loan w/o
Just write private usage out to the DLA.

If the DLA is in credit then there should be no BIK for any benefit where the individual is allowed to 'make good'.

NeilW

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