Shareholder loan timing

Tax Topics
1

In the midst of exhaustion - want to ensure correct.
I want to confirm a shareholder loan repayment timing -
corporate year end april 30
shareholder loan september 2022
if the loan fully due by year end april 30, 2024 (the fiscal year after the year it was made)
interest at prescribed rate in september is due
loan agreement should be made
My client keeps asking me if i am correct and now he is making me doubt myself - so i thought i would reach out.
thanks

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2

Deemed dividends if not paid by April 30, 2024. Forget the interest, think about the huge additional personal taxes.

Atul

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3

Okay thank you and i agree about the huge personal taxes.
Have warned them about series of loans and repayments as well

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4

You probably want to refer to the exact wording of S15(2) regarding the 100% inclusion into income of the whole loan in 2022 if they don’t meet the saving provision in the wording of S15(2.6)

Also, you will want to refer to the exact wording for S80.4 regarding how much interest will have to be included in this Director’s 2022 TY benefit.

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5

And they better make sure this does not become a series of payments. [Where the loan is paid off and then the money is advanced again]