Loan to company from director

Need to know what guidelines to follow if company taking loan from director and what the director needs to follow as an individual if he is giving loan from savings account to the company? and is there minimum period for company before closing loan or can close it within the same FY?
Replies (3)

both transation made with account payee check

 

if the loan taken it is should be in account payee check and you pay the interest on loan amount it is also  in account payee check
 

Yes, all transactions should be through account payee cheque.

There is no monetary limit prescribes for taking loan by company from director. However the director cannot lend to the company fom his loan funds. If he does that, the loan from director will be treated as public deposit and additional compliance will follow.

If interest is paid - TDS has to be deducted on payments above Rs 5000/- p.a @ 10%.

Resolution passed has to be filed with MCA

Company is not yet formed however can the director / partner pay for some expenses right now via savings account?

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