Where a director's loan account debit balance is written, and the director is also a major shareholder, the write-off is deemed to be a schedule F distribution for purpose of the director's tax position. Is this write-off also classed as a non-corporate distribution when calculatinf the company's Corporation Tax liability?
Simon Hall
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Was, not is
For events prior to 1 April 2006, any distribution made to a participator who is not subject to corporation tax counted as an NCD.
Obviously, the above no longer applies for events post 31 March 2006.
Loan benefit
Do not forget that any amount of loan written off incurs a benefit reportable on form P11D.