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Dividend v interest on director's loan

Dividend v interest on director's loan

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The imminent arrival of tax on dividends is making me think about alternative income extraction for directors of small companies.  As long as the income taken does not put the director into the higher rate tax bracket it seems to me that extracting the maximum market rent on director owned property must be favourite followed by interest on directors loans.  Does anyone know whether it will still be necessary to file CT61s after 6 April 2016 when interest is paid to directors? Does anyone have any better ideas? I would be interested to know.

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Should Be Working ... not playing with the car
By should_be_working
04th Mar 2016 18:08

CT61s

"Does anyone know whether it will still be necessary to file CT61s after 6 April 2016 when interest is paid to directors?"

According to Tim Good yesterday, yes. Not that that should stop any competent(!) client using interest as a (CT-deductible) route for extraction.

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By Rebecca Cave
17th Jun 2016 10:34

Yes a form CT61 is still required when interest is paid by the company. The new version of form CT61 has just been released: https://www.gov.uk/government/publications/corporation-tax-return-of-inc...

You can download the notes to CT61, but the actual form must be requested for each company as it is printed with the reference number for the company. You can request forms CT61 for up to 5 companies on one structured email to HMRC, or by calling one of the CT offices.

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