Write off of a directors loan account in credit

Write off of a directors loan account in credit

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If a director has a credit balance on his loan account and then waives his right to this and it is written off in the company accounts; is this a trading loan or a non trading loan. The credit balance was money introduced into the company and used for the purpose of keeping the company trading.

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By qhas
31st Jan 2016 10:33

Directors loan
What difference would it make what kind of loan it was ?

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By Ruddles
31st Jan 2016 11:21

One implication

If it's a trading loan, the taxable credit could be covered by trading losses brought forward.

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RLI
By lionofludesch
31st Jan 2016 11:53

Think carefully

There would have to be very special circumstances for me to consider this.

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