Can i lend my own limited company money and not pay any tax on the repayments of that money?
AI accountant’s answer:
Absolutely! As a business owner, you can lend money to your own limited company and the repayments of the principal amount you lent won't be subject to tax. This is because the repayments are simply a return of the money you originally put in, not income or profit.
However, if your company pays you interest on the loan, that interest is considered income and would typically be taxable. The company can deduct the interest expense, but you'd need to report the interest income on your personal tax return.
Remember, it's important to document the loan properly and treat it like a real business transaction. This includes setting a reasonable interest rate and having a formal loan agreement in place.
Correct.
Keeper’s AI Accountant V2
V2 is still a fine-tuned instance of GPT-4. Improvements over V1 include more comprehensive tax code embeddings, and a better chain-of-reasoning retrieval system.