Hi,
What would the tax treatment be on a loan to a UK resident director of a non uk company.
The company makes the director a loan above £10,000.
I assume that the loan would be treated as bik and tax would be due on the interest rate differential and submitted on his p11d.
Loan was made in 2015-2016 tax year.
There is the possibility that the director may be posted overseas for a number of years.
What would the UK tax treatment be, if any, on the director if he pays back the loan whilst he is a non resident of the UK and would he still be taxed on the loan as a Bik ?
Thanks
Replies (1)
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What is the problem?
The loan whilst it is outstanding is an "employment -related loan. When it is repaid it ceases to be one, so the BiK charge drops away.
There may be a confusion with the CTA 2010 s.455, which addresses loans to participators in close companies. But a non resident company is not a close company.
The only possible issue would be if the non-UK company were managed and controlled in the UK.