interest on company loan

B

bankloads

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Can sombody be so kind to tell me if i can charge interest on a sum of money (70k) I lent to the company that employs me, and what would be the appropriate amount of interest i could ask for on the loan
The loan is being repaid to me by cheque for €1000 euros per month, how do the revunue view this.
 
Is this Revenue guide of any use?

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and in particuar this section:

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Hi bankloads

I would think that you are better making it an interest free loan. It's less confusing and there will be no audit or compliance issues.

You could pay yourself 5% a year or €3,500. But you would be paying tax and prsi on that, so why not pay it as directors' salary?

I think it's better to keep everything simple.

Brendan
 
Thanks, Clubmam & Brenden.

Brenden do you mean when you say "why not pay it as a directors salary"

to be paid back to me €1k every month for 5 years 10 months = €70k, this payment would be seperate to my salary and would have no tax liability.

Bankloads
 
On a seperate line if you borrowed the money personally to invest in the company you can claim the interest paid on this borrowings against your income tax at marginal rate. This can often be a better way to borrow for company expenditure rather than borrowing within the company. The interest is relievable at the marginal rate.
 
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