Liquidation - Directors Loan


D

David Sullivan

Can someone tell me, in the event of company liquidation, what happens to
oustanding directors loans - e.g. presumably the appointed liquidator seeks
for immediate repayment ?
 
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T

Tim

Can someone tell me, in the event of company liquidation,
what happens to oustanding directors loans - e.g. presumably
the appointed liquidator seeks for immediate repayment ?
Do you mean loans *to* the director, or *from* the director?
 
P

Paul

Can someone tell me, in the event of company liquidation, what happens to
oustanding directors loans - e.g. presumably the appointed liquidator
seeks
for immediate repayment ?
Presumably you mean a debtor of the company - and yes, the liquidator will
seek immediate repayment.

That said, if you were the director and couldn't pay, the liquidator would
rather do a deal and get something rather than bankrupt you and get nothing.
 
D

David Sullivan

Yes - sorry, I should have made it clearer. It is a loan TO the director.
 
J

john boyle

David Sullivan said:
Yes - sorry, I should have made it clearer. It is a loan TO the director.
Well apart from the fact that there is a chance that the loan
contravenes the companies act, it would be repayable to the liquidator.
How quickly that would need to be done would depend on the terms of the
loan.
 
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C

Chris

john boyle said:
director.

Well apart from the fact that there is a chance that the loan
contravenes the companies act, it would be repayable to the liquidator.
How quickly that would need to be done would depend on the terms of the
loan.
And I hope that loan was interest bearing at commerical rates or declared on
a P11D as a low cost loan, otherwise the Inland Revenue might start blurting
out assessment under section 419 of the Income and Corporation Taxes Act
1988 (as amended) which is a pain in the arse having spent 2 years arguing
over there interpritation of a technicality, we ended up being told that the
inspector wouldn't back down fullstop and we were welcome to take it to
special commissioners but basically we know your not going to do that cos
you can't afford the barristers.
 

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