Quarterly BAS Due (July–September)
Form 1099-NEC & Contractor Payment Reporting Check
Why this matters.
A director’s loan account records money moving between you and your company outside salary, dividends and expense claims. Under section 455 of the Corporation Tax Act 2010, if a close company is still owed money by a participator at the end of nine months and one day after its accounting period ends, it must pay a charge of 33.75% of the outstanding balance. For companies with a 31 March 2026 year-end, that date is 1 January 2027. The charge is repayable only once the loan is repaid, written off or released, and then only after a claim is made, so it can tie up company cash for a long time.
Loans above £10,000 can also create a taxable benefit in kind for the director under the Income Tax (Earnings and Pensions) Act 2003 if no or low interest is charged, reportable on form P11D with Class 1A National Insurance for the company. Repaying a loan shortly before year-end and re-borrowing can fall foul of the 30-day “bed and breakfasting” rules and the arrangements rule. Releasing or writing off a loan has its own tax consequences, and the Companies Act 2006 requires shareholder approval for certain loans to directors. A short review now helps you avoid avoidable charges.
