Company Loans

Hubert

Registered User
Messages
14
I have a query - say my brother has a company and I have a company. He needs funds in his company to make pension contributions. Can my company lend his company money and what tax issues are there with this does anyone know? Thanks
 

dublin67

Frequent Poster
Messages
235
The answer is yes for tax rules - a company can lend to another company. Tax issues should only arise where the company is resident outside of the European Union. The key issue here for your company is that your brother's company is making company pension contributions. If the money is being on-lent to your brother from his company then tax issues will arise. You will also need to consider company law issues in lending money where it exceeds certain limits.
 

EmmDee

Registered User
Messages
198
The answer is yes for tax rules - a company can lend to another company. Tax issues should only arise where the company is resident outside of the European Union. The key issue here for your company is that your brother's company is making company pension contributions. If the money is being on-lent to your brother from his company then tax issues will arise. You will also need to consider company law issues in lending money where it exceeds certain limits.
Also - double check the M&A of your company to make sure they don't restrict the ability to make loans. Usually M&A are fairly broadly written but if the Directors act "ultra vires", personal liability can come into play.
 
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