You are here

Shark-infested waters

Owner-managed businesses should beware and be aware of changes to loan rules, says Lucy Brennan

23 September 2013

Owners and directors of companies should beware the lasting effect of the new loan rules brought in under this year's Budget. The rules, which were brought in with immediate effect and no consultation, challenge previously established cash flow planning within companies.

One technique that directors and shareholders of small companies have used to help with their cash flow is using loan accounts. Directors can draw from a loan account during the year and repay it within nine months of the year end, possibly by way of declaring a dividend that is offset against the loan account rather than taken as cash from the company.

The repayment stops the company having to pay tax on the loan account (a tax that is repaid when the loan is repaid or written off by the company) and brings the withdrawal into the director's income tax computation, if it is a repayment through income such as a dividend. The timing can help with cash flow for the company and direct...

Want to read on?

This article is part of our subscription-based access. Please pick one of the options below to continue.

Already registered? Login to access premium content

SUBSCRIBE for one User

Unlimited access to the entire SJ website for a full year for one user.

  • 10 issues a year delivered to you
  • Digital edition of the magazine for one user – sent to your inbox or accessible through the website
  • Access to premium content on the website
  • Access to the fully searchable online archive of Solicitors Journal, Managing Partner and Private Client Adviser, which spans over 13 years
  • Weekly email newsletter with all the latest news, analysis and features
  • Comment on SJ content and contribute to the SJ community online
  • Advanced search feature
  • Online support
  • Access to SJ app compatible with Android and Apple devices – coming soon!
  • 6 special focuses per year
  • Special offers and discounts on Solicitors Journal and IICJ events

Subscribe

CORPORATE SUBSCRIPTION

Your department or entire firm can subscribe to Solicitors Journal online, providing easy access for all who require it. Discount corporate subscription rates apply, based on number of users.

The Corporate IP Licence includes:

  • Digital copy of the magazine sent to individuals’ inboxes and accessible through the website. Solicitors Journal publishes 10 issues per year
  • Unlimited access to premium content on the website based on IP addresses
  • Unlimited access to the fully searchable online archive of Solicitors Journal, Managing Partner and Private Client Adviser, which spans over 13 years
  • Weekly email newsletter with all the latest news, analysis and features
  • Comment on SJ content and contribute to the SJ community online (username required)
  • Unlimited access to SJ app compatible with Android and Apple devices
  • 6 special focuses per year
  • Special offers and discounts on Solicitors Journal and IICJ events

The Corporate IP Licence is tailored to your firm, making it the most cost effective way for the firm to access Solicitors Journal, and enables the firm to remain compliant with copyright and our Terms and Conditions. This gives you the ability to print and circulate articles within the firm.

To enquire about a Corporate IP Licence for your firm, please contact our Subscriptions Manager on emily.beechey@solicitorsjournal.com.