Hi
I think the question should be simple, but I got a bit confused about it after reading different guides.
Opening balance of DLA was nil, and closing balance is £2,000. The amount has been repaid before submitting the accounts to CH and CT600 to HMRC, that is before 9 months after year end passed. Does the interest still need to be calculated and included in the Accounts?
Thanks
Replies (17)
Please login or register to join the discussion.
What interest?
Has the director agreed to pay interest?
Otherwise, why sweat it. There's no S.455 as paid within the time limit, and no BIK as below £10k.
Missing info
We've been given the opening and closing balances - anyone care to hazard a guess at what other info we might need to answer the question?
If the loan was made on the basis that the director would pay interest on it, then yes of course the amount accrued up to the year end needs to be calculated and provided for in the accounts.
But as you say the accounts have already been submitted to Companies House you seem to have missed the boat, and I am puzzled as to why you are asking the question after the event.
Tentative
If the loan was made on the basis that the director would pay interest on it, then yes of course the amount accrued up to the year end needs to be calculated and provided for in the accounts. But as you say the accounts have already been submitted to Companies House you seem to have missed the boat, and I am puzzled as to why you are asking the question after the event.
I possibly (tentative) construe the original post as saying that the loan has been repaid before accounts/CT600 due to be lodged and they have still not been lodged, however it is not very clear
Potential implications
You might also need to consider possible NI and P11D penalty implications.
There are 3 figures that are important
The opening balance, the closing balance and ... ? Go on, have a guess.
He only has to pay interest if he has agreed with the company that he will do so. If he is the only shareholder he can make his own mind up.
There can be tax consequences of not paying interest on loans from companies, but not in these circumstances. For a start the loan has to exceed £10,000.
You mean that it didn't exceed £10K during the year? Yes fair enough that is what I am assuming.
Aw, John
You've given the game away. I had hoped the OP would try and work it out for himself.