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Payment of directors home/land purchase loan by the company

Pvt ltd 681 views 2 replies

Suresh Babu

Managing Director

24 Points Posted on 12 June 2012

Hi,

I liked to know whether company can close or repay the loan (Home Loan / Land Purchase Loan) procured by the Directors of the Company.

If then, what are the formalities or procedure for the same? Whether we need to pay TDS for the same, if we repay like this?

If not, what are the other ways to do this?

Regards

Suresh Babu

Replies (2)

CA Hardik Bunha

self

2121 Points Posted on 12 June 2012

Yes, you can pay it. statutory auditor has to comment on this. yes you have to deduct tds on interest paid to director.

vijaya simha P

Auditor and Tax Consultant

39 Points Posted on 13 June 2012

As per company law , The directors of the company can not draw any amount from the company otherthah salary as approved in the board of Directors meeting. and hence repayment of loan on behalf of director does not arise at all. The directors can draw salary as said above and Dividend only and nothing else.