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Director's Loan to Company - What documentation

  • 20-12-2010 3:45pm
    #1
    CapedCrusader
    Registered Users, Registered Users 2 Posts: 215 ✭✭


    Hi folks,

    I converted from sole trader to ltd. company. Around €50k of stock was transferred to the company by way of a director's loan to the business.

    I am assuming that the most tax efficient way of taking money from the company is for the company to replay some of this loan to me. I.e., what I would otherwise have taken in salary.

    Couple of questions:

    1. What documentation is required for this director's loan?
    2. What are the tax liabilities, if any, if the company makes a repayment of this loan to me? Do I have a personal tax liability on the amount I'm repaid?

    Thanks in advance all,

    CC


Comments

  • #2
    dbran
    Registered Users, Registered Users 2 Posts: 2,094 ✭✭✭dbran


    Hi

    As this represents transfer of property to a company by the directors, it needs to be approved by the shareholders of the company at the AGM.

    As for your second question where you are transferring a sole trader to a limited company there can be income tax, stamp duty, Vat and capital gains tax issues involved. The extent of the liabilities will be based on the structure of the transfer and you should seek professional advise before you proceed.


    Kind Regards


    Dbran


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