Loan to company treated as Equity by ATO

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Adj Prof Dr Brett Davies

Adj Prof Dr Brett Davies

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发布日期: 2018年3月15日

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Loan to a company - to prove a loan & not equity: Debt Equity rules

Related party ‘at call’ loans provided to your company: Debt/Equity Rules

Your company buys a truck. Instead of the company borrowing the money from a bank, you draw the money out of your own bank account. Did you loan the money to the company? Or was it an injection of equity? The ATO says because there is no legally enforceable Loan Agreement it was an injection of cash. This means that it is difficult to get the money back tax-free.

If you hand money to a company it is either a loan (good) or an injection of equity (generally bad).

Here are the rules.

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