Director's loan repayment

Director's loan repayment

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A company director needs to repay a loan to his company before 31st December to avoid the Corporation Tax charge. To raise the £50k he needs, he is remortgaging a property he owns, but the money won't come through until the first week in January. Can he borrow the £50k from a second company of which he is a director/shareholder, use that to repay the loan from company 1 and then repay company 2 when his remortgage finance comes through, probably a week later?

Here's hoping...

BD

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Euan's picture
By Euan MacLennan
22nd Nov 2013 14:46

Why not?

Don't forget the BIK if interest is not being paid at 4% p.a.

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By dropoutguy
22nd Nov 2013 16:27

As long

as money changes hands.  Don't just do it by accounting entries as I've seen done in the past.

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