Withdrawal of funds options

[helpingperson]

Hi fellows,

One of the main requirement for Tier 1 entrepreneur visa is to show investment of £200,000 which can be achieved by transferring funds from director personal account to company account in form of loan to company.

How can we withdraw those funds transferred in company account without incurring significant tax liability?

In other words what are best options to withdraw funds from company account?

Thank you.

[MTZ510]

Hi fellows,

One of the main requirement for Tier 1 entrepreneur visa is to show investment of £200,000 which can be achieved by transferring funds from director personal account to company account in form of loan to company.

How can we withdraw those funds transferred in company account without incurring significant tax liability?

In other words what are best options to withdraw funds from company account?

Thank you.

My understanding is that the directors can withdraw the funds from directors loan account without incurring any tax liability.
This is the reason investment through Directors loan is preferred over investment in share capital.

[helpingperson]

After all the research, I have managed to find that if you give loan to your company, you can withdraw it and there are no tax implications. But it has to be loan money which you gave to company and not company earnings/profits/sales,etc..

Below is the text from HMRC website and link.

Please add your views on this.


http://www.hmrc.gov.uk/ct/managing/director-loan.htm


You lend money to your company: director's loan account in credit
If you lend your company money (for example by paying money into your company's bank account as opposed to, say, buying shares) your director's loan account is in credit.
You can draw some or all of this money out at any time. There are no tax implications for your Company Tax Return.

[MTZ510]

After all the research, I have managed to find that if you give loan to your company, you can withdraw it and there are no tax implications. But it has to be loan money which you gave to company and not company earnings/profits/sales,etc..

Below is the text from HMRC website and link.

Please add your views on this.


http://www.hmrc.gov.uk/ct/managing/director-loan.htm


You lend money to your company: director's loan account in credit
If you lend your company money (for example by paying money into your company's bank account as opposed to, say, buying shares) your director's loan account is in credit.
You can draw some or all of this money out at any time. There are no tax implications for your Company Tax Return.

That's exactly what i wrote in my previous post.

[kayani2012]

rite if i transfer money from personal account to business account in shape of Director loan, which kind of agreement i need for it?