Director's Loan Calculator

Money out of your company that is not salary or dividend becomes a director's loan · with a 33.75% trap on a timer. Here is your exposure and the deadlines.

Total Tax Exposure
£0
Enter your loan to calculate
s455 Charge (33.75%)
£0
s455 Refundable?
Yes · after repayment
BiK Taxable Benefit
£0
Your Income Tax on BiK
£0
Company Class 1A NI
£0
Interest to Kill the BiK
£0
Enter your loan to get started.
Your Exposure Breakdown
The Timeline That Matters
Company year end · loan balance snapshotted in the accounts
+9 months 1 day · s455 due at 33.75% on whatever remains unpaid (with corporation tax)
Repay later? · s455 refunded, but only 9 months after the end of the accounting period of repayment
£10,000+ at any point in the tax year · beneficial loan BiK unless official-rate interest is paid
Repay-and-redraw within 30 days (£5,000+) · matched and ignored by anti-avoidance rules

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Director's Loan FAQs

What is section 455 tax?
If your loan is still outstanding 9 months and 1 day after the company year end, the company pays 33.75% of the balance to HMRC alongside corporation tax. It is refundable after you repay · but only 9 months after the end of the accounting period in which repayment happens, so the cash can sit with HMRC for the best part of two years. An interest-free loan that triggers s455 is not free at all.
When does the loan create a benefit in kind?
Over £10,000 outstanding at any point in the tax year with less than official-rate interest (2.25%) paid, the interest saved becomes a taxable benefit: income tax for you, Class 1A NI at 15% for the company, and a P11D entry. Charging yourself exactly the official rate eliminates it · often the cheapest fix.
What is bed and breakfasting?
Repaying just before the 9-month deadline and redrawing after · HMRC closed it: repayments of £5,000+ redrawn within 30 days are matched and ignored, and bigger arrangements fail on intention regardless of timing. Clear the loan with real money: cash, a declared dividend, or a bonus.
How do I clear the loan?
Four routes: repay cash · declare a dividend against it (needs distributable profits; taxed as dividend income) · vote a bonus through payroll (income tax + NI) · or write it off (taxed on you like a dividend, possible NI for the company). The cheapest mix depends on your bands and the company's profits · this is genuinely worth an accountant conversation before year end, not after.
Is a director's loan ever a good idea?
Short-term, yes: up to £10,000, interest-free, for up to ~21 months (drawn early in the company year, repaid by the 9-month deadline) with zero personal tax · a genuinely free bridge for a house deposit gap or tax bill. As long-term finance it is usually beaten by planned dividends, and habitual large loans invite HMRC scrutiny.

For informational purposes only · Not tax advice · Rates: s455 33.75%, official rate 2.25%, Class 1A NI 15%, BiK threshold £10,000 · Anti-avoidance: 30-day and intention rules on repay-and-redraw · Speak to your accountant before year end