Inter-company loans
This query is : Resolved
25 October 2016
Hi Experts,
Am working in private limited where we haven given inter-company loans to subsidiary (100% holding) and charging interest not less than govt.bond rates, now i would like to check whether the inter-company loan can be given more than 60% of net worth of company?? so to calculate net worth what period I should consider is it 31st March or any point of time company should not cross 60% of net worth??. please advise.
Regards
Nagaraju
Am working in private limited where we haven given inter-company loans to subsidiary (100% holding) and charging interest not less than govt.bond rates, now i would like to check whether the inter-company loan can be given more than 60% of net worth of company?? so to calculate net worth what period I should consider is it 31st March or any point of time company should not cross 60% of net worth??. please advise.
Regards
Nagaraju
26 October 2016
yes, According to section 186 a private limited company can give loan to its wholly owned subsidiary company in excess of limit of 60% just by passing board resolution. No need of special resolution. net worth shall be considered as on 31st March
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