New tax procedure for Directors Loans (s 455)

Information for registered directors of UK entities to be aware of when their DLA’s (Director’s Loan Accounts) are overdrawn

Steve J Bicknell


Its very common in Small Businesses for the Directors Loan account to be overdrawn creating a Directors Loan.

If the loan isn’t repaid within 9 months of year end the company will pay temporary additional Corporation Tax at the rate of 25% on the balance outstanding.

Section 455 CTA 2010 liabilities must be included in a company’s CT600 tax return. The S455 tax forms part of the calculation of tax payable by the company under Paragraph 8 Schedule 18 FA 1998.

A claim to relief under Section 458 is a claim for relief against the original tax charge for the AP in which the loan was made. The time limit for the claim is four years from the end of the financial year in which the loan is repaid, released or written off. COM53120

Until now there has been no set format for writing to HMRC to reclaim the s.455…

View original post 44 more words

Leave a Reply

Fill in your details below or click an icon to log in: Logo

You are commenting using your account. Log Out /  Change )

Google+ photo

You are commenting using your Google+ account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s