Just discovered that sole director has been paying himself huge directors loans (100's of thousands) over the past few years.
He has admitted that he loans from company A to Company B, which then loans to director, then from A-director & circulates the payments to avoid S455 tax.
The reason given is that he is avoiding paying a dividend as it would have to be split between himself & other shareholder (ex wife)
i believe a large sums have sat in his offset mortgage account for his personal property to negate an interest charge, which is the replaced by a 'loan' from other company.
my question is, what are the legalities and consequence for this.