Director's loan agreement
A director shareholder doesn’t have to sign a loan agreement when they borrow money from their company. The terms of borrowing can be agreed orally or just implied. However, in certain situations a director is required by company law to obtain permission from the shareholders prior to borrowing company money.
Get it in writing
Shareholder approval (generally by ordinary resolution) is only required for directors’ loans in excess of £10,000 (the limit is £50,000 if the loan is to meet expenditure on company business). But in all situations where a company lends money to a director we recommend that a written agreement setting out the key terms should be drawn up. Apart from anything else it will help prove the existence of a loan where HMRC makes enquiries.
Use and modify as needed our sample loan agreement for all company to director loans.
Related Topics
-
The Deputy Prime Minister, SDLT and a tale of woe
You can’t have missed the recent furore surrounding the apparent tax dodging exploits of Angela Rayner. The issues involved might seem remote for most taxpayers, but are there lessons to be learned for all of us?
-
In-year relief claim? Prove it
Taxpayers not in self-assessment and who need to claim relief on pension contributions must now send evidence to HMRC. What’s the full story?
-
HMRC has withdrawn Form 652. How should you notify VAT errors going forward?
This website uses both its own and third-party cookies to analyze our services and navigation on our website in order to improve its contents (analytical purposes: measure visits and sources of web traffic). The legal basis is the consent of the user, except in the case of basic cookies, which are essential to navigate this website.