Documents for Business
In excess of 1,000 customisable documents covering every conceivable business issue.Introduction to this document
Director’s or employee’s loan account record
A taxable benefit in kind may arise where an employee or director borrows or uses their company’s money. You must keep a record of money owed by the employee or director to enable you to calculate the taxable benefit, if any.
Running record
As part of your business records you must keep a record of debts owed to your company or organisation by an employee or director. This also has a role for tax and NI purposes.
Taxable benefit
Where a cheap rate or interest-free loan or other debt is advanced to an employee or director it results in a taxable benefit in kind if the amount owed exceeds £10,000 at any time during a tax year and the interest payable by the employee or director on the debt is charged at a rate less than HMRC’s official rate (which varies from year to year).
For the purpose of measuring the loan or debt against the £10,000 limit, all loans and debts must be aggregated.
Use our Director’s or Employee’s Loan Account Record to keep track of loans and debts and help you work out the amount of taxable benefit in kind if applicable.
