Car Loan til April

[Scrag Meister]

I am just about to buy a new (used) car and am planning to borrow 16k from the company and then pay it back inc 4% interest come the new tax year as part of a 27k dividend, 7th April 2012 i.e. Approx 2.5 months.

Can any of the accountancy types here let me know if this is ok?

ADV-Thanks-ANCE

[northernladuk]

If it is a 350Z then yes otherwise no.

[Scrag Meister]

If it is a 350Z then yes otherwise no.

Sorry NLUK but the 350Z is going, just isn't getting used, part-exing that and our trusty Punto and looking to get a Nissan GTR, oops oh no that's wrong, wake up Scrag, its a Nissan Murano Diesel.

We only need 1 car now and travelling less as the Devon trips are only 1 a month or so now.

[Clare@InTouch]

Sounds fine to me - the interest will offset any BIK and it won't be o/s long enough to cause a S455 issue.

I agree with NLUK though - make it a 350Z

[Scrag Meister]

Sounds fine to me - the interest will offset any BIK and it won't be o/s long enough to cause a S455 issue.

I agree with NLUK though - make it a 350Z

Thanks for the response Clare.

I've already got a 350Z that I barely drive. So we were looking to get 1 decent car that we can drive regularly, but instead we settled for a Murano. LOL

[Nixon Williams]

I am just about to buy a new (used) car and am planning to borrow 16k from the company and then pay it back inc 4% interest come the new tax year as part of a 27k dividend, 7th April 2012 i.e. Approx 2.5 months.

Can any of the accountancy types here let me know if this is ok?

ADV-Thanks-ANCE

Following the Companies Act 2006, loans to directors in excess of £10,000 need shareholder approval. So whilst this is probably just yourself, in order to keep the paperwork in order and keep HMRC happy, make sure that the shareholders approve the loan!

Alan

[Scrag Meister]

Following the Companies Act 2006, loans to directors in excess of £10,000 need shareholder approval. So whilst this is probably just yourself, in order to keep the paperwork in order and keep HMRC happy, make sure that the shareholders approve the loan!

Alan

What form would this take? Some minutes to show I had a meeting with myself to approve lending your truly some money?

[northernladuk]

Thanks for the response Clare.

I've already got a 350Z that I barely drive. So we were looking to get 1 decent car

You saying the 350Z isn't decent?? huh huh??

[Nixon Williams]

What form would this take? Some minutes to show I had a meeting with myself to approve lending your truly some money?

Mad as it sounds, but yes, this would generally be approved at a general meeting of the shareholders but with a single shareholder company, you could just 'pass' a written resolution, agreeing to the terms of the loan.

Alan

[Clare@InTouch]

You saying the 350Z isn't decent?? huh huh??

No you prune, I'm agreeing with you that it IS decent