Directors account funds - Can this be transferred

Over the years I have built up a directors account with €xx,xxx showing as owing to both myself and the other company director. Different amounts for each director.

The company is only a small company with two equal directors.
All vat and creditors are paid. There are not much funds in the company to pay back the directors loan account but in a few years it may be something that may arise.

I am currently looking at preparing a will, and my query is if I were to die can the funds be paid to someone else at a future date or can they be assigned to the other director or to someone else, this is money we have both invested in the company and should be able to be taken out at a future date tax free.

Any advice, greatly appreciated.

Any credit balance on a director's account is a debt owing to that person, and is an asset that can be assigned by testamentary disposition.

For your mutual protection, I suggest that you and your colleague draw up a contractual agreement on how directors' loans be repaid - you would neither of you want the company to be brought down by a beneficiary who is impatient in exercising a claim. You might also find it useful to make some arrangement on the disposition of shares in the case of the death of either one of you.

The best plan would be for you to survive until the business prospers.

If I can count on it as a asset that is great. It would be great if I were to go contracting as I could get it repaid from the contract work. Also I could list it in my will I could assign it leave it to the other director. I agree it would be very important to get something agreed as you never know if the something happened the other director and their next of kin came demanding something that was not available.

The funds build up over a number of years and it is now I see their potential.
If we were to close the company then would these liabilities die with the company?

You don't need to list your assets in a will, and it is a bad idea to do so, because your assets change over time. What you should do is make sure that there is enough documentation kept so that an executor can trace all your assets. You could leave some notes in the same place that your will is kept.

Whether balances owing to directors die with the company is not answerable with a simple yes or no. It depends on the overall situation, and how much is raised in the winding up of the company.