Employee change of status

9 months into financial year an employee (sole director and shareholder's daughter) becomes the sole director and shares transferred to her. Prior to becoming a director she accumulated a loan account from receiving monies on top of salary. The same thing happened after becoming a director and therefore has an overdrawn loan account. There are no reserves to pay dividends to clear.

My query is does the loan account prior to becoming a director get lumped together with the post directorship loan with all the tax and interest ramifications etc.

Many thanks in advance for any help you may give

John

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Not a lot has actually changed

Steve Kesby |
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