As of April 2025, directors of close companies and self-employed taxpayers face new mandatory reporting requirements on their Self-Assessment returns. Up to 900,000 company directors and 1.2 million
Category: Director
When Dividends Cannot Be Paid - UK Company Law & Tax Implications
Summary
Under the Companies Act 2006, companies are legally restricted in how they can distribute profits. Dividends can only be paid from realised profits, never from capital — regardless of
EMI Stock Options & BADR Changes - The Complete Founder-s Guide
Introduction – Why EMI & BADR Matter More Than Ever in 2025
In today-s competitive business environment, attracting and retaining the right talent can be as critical as securing funding. For
HMRC and Director-s Loans: Key Scenarios That Trigger Investigations Explained
HMRC and Director-s Loans: Key Scenarios That Trigger Investigations Explained When you use a director-s loan account, HMRC often watches closely for signs of misuse or non-compliance. Common triggers for investigation include large loans over -10,000, failure to repay the loan on time, or informal write-offs without proper documentation. These situations can lead to penalties … Continue reading HMRC and Director-s Loans: Key Scenarios That Trigger Investigations Explained
Director-s Loans: What They Are and How to Use Them Legally for Effective Business Management
Director-s Loans: What They Are and How to Use Them Legally for Effective Business Management A director-s loan is money you take from or lend to your company outside of your salary, dividends, or expenses. It is important to keep clear records of these loans and repay them on time to avoid extra tax and … Continue reading Director-s Loans: What They Are and How to Use Them Legally for Effective Business Management
Taking Money Out of Your Company? Here-s When It Counts as a Director-s Loan and What You Need to Know
Taking Money Out of Your Company? Here-s When It Counts as a Director-s Loan and What You Need to Know When you take money out of your limited company, it doesn-t always count as salary or dividends. If the money you take isn-t a salary, dividend, expense repayment, or repayment of a previous loan, it … Continue reading Taking Money Out of Your Company? Here-s When It Counts as a Director-s Loan and What You Need to Know
How to Record Director-s Loans in Your Company Books Without Raising Red Flags - A Clear Guide for Accurate Accounting
How to Record Director-s Loans in Your Company Books Without Raising Red Flags - A Clear Guide for Accurate Accounting Recording director-s loans correctly in your company books is essential to avoid raising red flags with HMRC or your accountants. You need to keep clear records of all transactions between you and your company, noting … Continue reading How to Record Director-s Loans in Your Company Books Without Raising Red Flags - A Clear Guide for Accurate Accounting
The 32.5% Tax Trap: Consequences of Failing to Repay a Director-s Loan on Time
The 32.5% Tax Trap: Consequences of Failing to Repay a Director-s Loan on Time If you have taken a director-s loan from your company, it is crucial to repay it on time. If you don-t repay the loan within nine months and one day after your company-s year-end, a 32.5% tax charge will be applied … Continue reading The 32.5% Tax Trap: Consequences of Failing to Repay a Director-s Loan on Time
How to Maintain a Clear Director-s Loan Ledger: Essential Templates and Practical Tips for Accuracy
How to Maintain a Clear Director-s Loan Ledger: Essential Templates and Practical Tips for Accuracy Maintaining a clear director-s loan ledger is essential for managing your company-s finances accurately and avoiding tax issues. The key to keeping a clean loan account is to record every transaction clearly, whether money is borrowed from or lent to … Continue reading How to Maintain a Clear Director-s Loan Ledger: Essential Templates and Practical Tips for Accuracy
Director-s Loan Accounts: Best Practices to Stay Compliant and Avoid HMRC Issues Efficiently
Director-s Loan Accounts: Best Practices to Stay Compliant and Avoid HMRC Issues Efficiently Managing a director-s loan account (DLA) in your UK limited company requires careful attention to avoid problems with HMRC. The key to staying compliant is keeping accurate records of every transaction between you and your company and understanding the tax rules that … Continue reading Director-s Loan Accounts: Best Practices to Stay Compliant and Avoid HMRC Issues Efficiently
What Happens if You Get It Wrong? Director-s Loans and Section 455 Tax Explained Clearly
What Happens if You Get It Wrong? Director-s Loans and Section 455 Tax Explained Clearly If you get director-s loans wrong, the company could face a significant tax charge under Section 455. This means you may have to pay Corporation Tax at a rate of 33.75% on any overdrawn loan that isn-t repaid within nine … Continue reading What Happens if You Get It Wrong? Director-s Loans and Section 455 Tax Explained Clearly
Selling a Former Home? When You Can Still Claim Private Residence Relief Explained
Selling a Former Home? When You Can Still Claim Private Residence Relief Explained When someone sells a home they used to live in, they might wonder if they can still claim Private Residence Relief to reduce their capital gains tax. They can claim this relief for the time they lived in the property as their … Continue reading Selling a Former Home? When You Can Still Claim Private Residence Relief Explained
The Tax Traps of Directors- Loans: Essential Insights for Company Owners to Avoid Costly Mistakes
The Tax Traps of Directors- Loans: Essential Insights for Company Owners to Avoid Costly Mistakes Directors- loans can be a useful way for company owners to access money when needed. However, if not managed carefully, these loans can create unexpected tax problems that may be costly to fix. The most important point is that if … Continue reading The Tax Traps of Directors- Loans: Essential Insights for Company Owners to Avoid Costly Mistakes
How to Properly Document Directors- and Shareholder Loans to Avoid HMRC Penalties: Essential Compliance and Record-Keeping Tips
How to Properly Document Directors- and Shareholder Loans to Avoid HMRC Penalties: Essential Compliance and Record-Keeping Tips Directors- and shareholder loans can be useful for managing company finances, but improper documentation risks serious penalties from HMRC. Keeping accurate records of loan amounts, repayments, and shareholder approvals is essential to stay compliant and avoid fines. Clear … Continue reading How to Properly Document Directors- and Shareholder Loans to Avoid HMRC Penalties: Essential Compliance and Record-Keeping Tips
When Can a Shareholder Loan Be Safer Than a Directors- Loan? Key Considerations for Business Financing
When Can a Shareholder Loan Be Safer Than a Directors- Loan? Key Considerations for Business Financing A shareholder loan can be safer than a directors- loan when the terms are more clearly defined and the risks of tax penalties are lower. Unlike directors- loans, shareholder loans often come with fewer restrictions and can offer better … Continue reading When Can a Shareholder Loan Be Safer Than a Directors- Loan? Key Considerations for Business Financing
Pulling Money from Your Company: Salary, Dividends, or Loan - Choosing the Best Method
HMRC Investigations: What Triggers a Business vs Personal Tax Check and How to Prepare Many directors wonder how best to take money out of their business. The main options are salary, dividends, or loans. Choosing the right method depends on the company-s profits, tax rules, and the director-s personal financial situation.Paying a salary means the … Continue reading Pulling Money from Your Company: Salary, Dividends, or Loan - Choosing the Best Method
HMRC Investigations: What Triggers a Business vs Personal Tax Check and How to Prepare
HMRC Investigations: What Triggers a Business vs Personal Tax Check and How to Prepare When HMRC decides to investigate, the triggers for business and personal tax checks can be quite different. For businesses, common causes include late filing, errors in tax returns, or unusual variations between accounts. For individuals, missed tax payments or discrepancies in … Continue reading HMRC Investigations: What Triggers a Business vs Personal Tax Check and How to Prepare
The Do-s and Don-ts of Recording a Director-s Loan: Essential Guidelines for Accurate Financial Management
The Do-s and Don-ts of Recording a Director-s Loan: Essential Guidelines for Accurate Financial Management When you take money out of your company or put it in for personal use, it-s important to keep accurate records in your director-s loan account (DLA). This account acts as a clear record of every transaction you make with … Continue reading The Do-s and Don-ts of Recording a Director-s Loan: Essential Guidelines for Accurate Financial Management
Top 10 Red Flags That Prompt an HMRC Tax Investigation and How to Avoid Them
Top 10 Red Flags That Prompt an HMRC Tax Investigation and How to Avoid Them If you are worried about an HMRC tax investigation, knowing the common warning signs can help you avoid unwanted attention. HM Revenue and Customs looks for certain red flags when reviewing tax returns and financial records. Understanding these triggers gives … Continue reading Top 10 Red Flags That Prompt an HMRC Tax Investigation and How to Avoid Them
Director-s Loan Accounts: How to Keep Yours Bulletproof with Essential Compliance Tips
Director-s Loan Accounts: How to Keep Yours Bulletproof with Essential Compliance Tips A director-s loan account (DLA) is a key part of managing your company-s finances, but it can cause problems if not handled correctly. Keeping your director-s loan account bulletproof means accurately recording every transaction, repaying loans on time, and understanding the tax rules … Continue reading Director-s Loan Accounts: How to Keep Yours Bulletproof with Essential Compliance Tips
Common Mistakes in Director-s Loan Accounts and How to Fix Them Efficiently and Compliantly
Common Mistakes in Director-s Loan Accounts and How to Fix Them Efficiently and Compliantly Managing a director-s loan account can be tricky, and many businesses make avoidable errors that lead to tax issues or complicated repayments. The most common mistakes include mixing personal and business expenses, failing to keep clear records, and missing critical repayment … Continue reading Common Mistakes in Director-s Loan Accounts and How to Fix Them Efficiently and Compliantly
Director-s Loans and Dividends: How to Document Each Correctly for Accurate Financial Records
Director-s Loans and Dividends: How to Document Each Correctly for Accurate Financial Records When dealing with director-s loans and dividends, proper documentation is essential to keep your company-s finances clear and compliant. You must have formal agreements, keep detailed records, and hold board meetings to approve any loans or dividends. This ensures transparency and helps … Continue reading Director-s Loans and Dividends: How to Document Each Correctly for Accurate Financial Records
Self-Assessment Mistakes That Raise HMRC Eyebrows and How to Avoid Them
Self-Assessment Mistakes That Raise HMRC Eyebrows and How to Avoid Them When you complete your Self-Assessment tax return, even small mistakes can make HMRC take a closer look. Common errors like missing income, incorrect figures, or filing late will often trigger reviews or penalties. Knowing which mistakes raise red flags can help you avoid unnecessary … Continue reading Self-Assessment Mistakes That Raise HMRC Eyebrows and How to Avoid Them
Avoiding Tax Trouble: What HMRC Expects in Your Director-s Loan Records Explained Clearly
Avoiding Tax Trouble: What HMRC Expects in Your Director-s Loan Records Explained Clearly Keeping accurate records of your director-s loan account is essential to avoid tax problems with HMRC. You must ensure your records clearly show any money you take out or put into the company, so HMRC can see whether you owe tax or … Continue reading Avoiding Tax Trouble: What HMRC Expects in Your Director-s Loan Records Explained Clearly
Recording a Director-s Loan: Essential Guidelines for Accurate Financial Management
Recording a Director-s Loan: Essential Guidelines for Accurate Financial Management When you take money out of your company or put it in for personal use, it-s important to keep accurate records in your director-s loan account (DLA). This account acts as a clear record of every transaction you make with the company that isn-t salary … Continue reading Recording a Director-s Loan: Essential Guidelines for Accurate Financial Management
FAQs About Director’s Loans: All You Need to Know
FAQs About Director's Loans: All You Need to Know Directors' loans can be a valuable tool for managing the finances of a limited company, but they also come with specific rules and implications that must be understood to avoid any pitfalls. A director's loan occurs when you take money from your company that is not … Continue reading FAQs About Director’s Loans: All You Need to Know
The Legal Implications of Director’s Loans: Essential Insights for Business Owners
The Legal Implications of Director's Loans: Essential Insights for Business Owners Navigating the complexities of director's loans can be challenging, but it's crucial to understand their legal implications. A director's loan occurs when a director borrows money from their company that is not part of their salary, dividend, or expense repayment. This can include money … Continue reading The Legal Implications of Director’s Loans: Essential Insights for Business Owners
Director’s Loans and Company Insolvency: Mitigating Risk and Ensuring Protection
Director's Loans and Company Insolvency: Mitigating Risk and Ensuring Protection Understanding director's loans and company insolvency is crucial for any business leader. A director's loan is when you take money from your company that isn-t salary, dividend, or expense repayment. If your company becomes insolvent, these loans could pose significant risks for you. The financial … Continue reading Director’s Loans and Company Insolvency: Mitigating Risk and Ensuring Protection
Using Director’s Loans for Company Growth: Weighing the Pros and Cons
Using Director's Loans for Company Growth: Weighing the Pros and Cons As a director, you may find yourself considering a director's loan as a way to support your company's growth. Using director's loans can provide immediate funding for your business needs while keeping you in control of your finances.This approach may help you expand operations, … Continue reading Using Director’s Loans for Company Growth: Weighing the Pros and Cons
Director’s Loans: Tax Implications When Selling Your Business
Director's Loans: Tax Implications When Selling Your Business Selling your business involves several complexities, and one of the crucial aspects to consider is director's loans. When you take money from your company that is not a salary, dividend, or an expense repayment, it falls under a director's loan. Understanding how these loans are treated during … Continue reading Director’s Loans: Tax Implications When Selling Your Business