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Hi all,

I have recently established a limited company and about to buy some BTL properties under this company. 

I have transferred some monies from my personal bank account into the company bank account. These monies are considered as Directors loans (from me to the company). 
my solicitor asked me to provide a directors loan agreement document and the board meeting minutes showing that the loan is accepted by the company. 
 

as I do not have an accountant right now, I will need to prepare them my self. Is there anyone who can help me find some templates for these please?

Thanks

Volkan 

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Hi @volkan_p

I just responded to another post you made on the same topic.  I've been investing through a limited company now for three years and you don't really need a written director's loan agreement if you / your partner own the limited company 100%.  It could be useful for a joint venture though, perhaps to formalise the agreement.

If you don't want to go down the formal route, you simply need to transfer the monies from your personal bank account into the company bank account and record the correct accounting entries in your company accounts.  Not to get too technical, but from an accounting perspective, any cash you contribute to the limited company counts as "capital" - this is a special type of liability of the limited company, i.e. it is money the company owes back to you as the director.

As long as you're not charging interest on the loan, then it's relatively straightforward and no loan documentation is needed.  Your accountant or bookkeeper should be able to deal with the accounting entries needed as part of your year end accounting.

Also, it's worth noting that when you repay the loan later, e.g. the company makes some rental profits and you decide to pay back the loan, the money that you take out is simply a repayment of the loan and is not taxed.

Hope this is helpful and feel free to drop me a private message if you want to know more about the accounting entries.

Best wishes

 Rob


Robert Heaton

Greenwich Bookkeeping | www.greenwichbookkeeping.co.uk

Author of "Essential Property Investment Calculations" - Available on Amazon

 

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