Dividend/Loan

[coolpixel]

newbie here.

can i take out dividends if i have an outstanding loan with the company? and what happens if the loan isn't repaid by the time of accounts filing?

[BrilloPad]

Yes you can take dividends.

Any loans to directors (and shareholders) outstanding at the balance sheet date (your company’s period end) have to be disclosed in the accounts and on the company tax return.

If they are not repaid within 9 months of the accounting period end then the company will pay extra Corporation Tax of 32.5% of the loans taken out after 6 April 2016 (or 25% on loans taken before 6 April). This extra 32.5% is repayable to the company by HMRC when the loan is repaid to the company.

If you can't use google or an accountant, maybe you should go back to permiedom....

[northernladuk]

I don't wish to be rude here, well I do but can't afford the infractions at the moment, but why are you buggering about with loans when you clearly don't understand the absolute basics of you remunerate yourself? Being a newbie is not an excuse to know so little and make so little effort to try understand it?

It's pretty fundamental so a bit of reading of the guides on the right or a bit of googling should be enough to understand most of your question. The rest you should be asking your accountant. You really shouldn't be messing with loans if you don't know the impact, cost and operation of them let alone the basics of dividends.

You need to do a little better than this if you are going to avoid costly mistakes going forward.

[radish2008]

Yes you can take dividends.

If they are not repaid within 9 months of the accounting period end then the company will pay extra Corporation Tax of 32.5% of the loans taken out after 6 April 2016 (or 25% on loans taken before 6 April). This extra 32.5% is repayable to the company by HMRC when the loan is repaid to the company.

If you can't use google or an accountant, maybe you should go back to permiedom....

Totally unnecessary insult along with incomplete information.
The interest of a directors loan is repaid by HMRC 9 months after the end of the reporting period it is paid back in. So you have quite a wait to get that interest back.

[northernladuk]

The above said I've just seen your posting history and you were flailing about with dividends back in December and asked more fundamental questions since. You aren't a newbie anymore. You are 10 months in and still don't know the basics.

Looking at your questions it looks like you don't have an accountant which is a huge mistake. Get one and ask them a lot of questions.

[Dan@OrangeGenie]

newbie here.

can i take out dividends if i have an outstanding loan with the company? and what happens if the loan isn't repaid by the time of accounts filing?

Would need more context to this really.

What profits are there after corp tax?
Is there a plan to replace the loan in the future?
What other income do you have?
Are you looking to contract long term?

I suggest speaking to an accountant who can also take a look at your accounts and future tax planning.

[northernladyuk]

newbie here.

can i take out dividends if i have an outstanding loan with the company? and what happens if the loan isn't repaid by the time of accounts filing?

If you are new and are involved in loans already, you really should have an accountant and ask your accountant. You do appear to be heading for a bad mess if you'don't have an accountant.

[Lance]

If you are new and are involved in loans already, you really should have an accountant and ask your accountant. You do appear to be heading for a bad mess if you'don't have an accountant.

Clearly OP doesn't have an accountant, and despite being told (repeatedly, in other posts) won't get an accountant. I wonder how they plan to distinguish between the bad advice and the good advice on these forums?

It's a good job this forum has PI insurance to cover against being sued for bad advice isn't it? Isn't it???? Doesn't it?

Oh -----

[northernladyuk]

Clearly OP doesn't have an accountant, and despite being told (repeatedly, in other posts) won't get an accountant. I wonder how they plan to distinguish between the bad advice and the good advice on these forums?

It's a good job this forum has PI insurance to cover against being sued for bad advice isn't it? Isn't it???? Doesn't it?

Oh -----

By asking an accountant.