07/05/2026
๐ท LOANS TO PARTICIPATORS (COMPANY SHAREHOLDERS) ๐ท
When a close company makes a loan to a participator (in most cases, this means a companyโs shareholder), and it's not repaid in the same accounting period, a corporation tax charge can arise. This is sometimes referred to as a โSection 455โ or โs.455โ charge.
For loans advanced on or after 6 April 2026, the percentage charged increased to 35.75% (previously, this was 33.75%).
Where a loan to a participator is repaid, released, or written off within nine months of the end of the accounting period, relief from the s.455 tax charge can be claimed in the corporation tax return.
It's not possible to claim relief for anticipated future loan repayments.
This means that company participators should take care to repay any outstanding participator loans before their company tax return is submitted.
If repayments are made after a return has been submitted, if you're a client of ours please let us know, so that an amended corporation tax return can be completed, and relief claimed, as appropriate.
๐ And if you're not yet a client of ours and would like to find out more about the many and varied ways we support our clients in all areas of their business accounting, feel free to give us a call and speak with one of the team: https://www.grant-jonesaccountancy.com/about-us/contact-us