Written by Paul Tweedie on 15 September 2021.
Div 7A Loan Agreements are now being put under the Microscope by the Australian Taxation Office in an effort to identify potential Tax avoidance by company directors and shareholders. It is more important than ever to ensure business owners and directors have a formal agreement in place to negate potential tax liabilities. Div 7A Loan Agreement is called a Div 7A Loan Agreement as it relates to Division 7A of Part lll of the Income Assessment Act 1936. Division 7A of Part lll of the Income Assessment Act 1936, in particular Division 7A of the Corporations Act, allows for a business to loan money to the directors, shareholders, or associates of shareholders. These loans are used for a number of reasons and are usually implemented in conjunction with the accountant of a business rather than the director themselves due to the potential taxation liabilities. The reason we have released these Div 7A Loan Agreements is basically just to formalise them.
With over 35 years’ experience Collection Consultancy Australia prides itself in offering Products and Services designed to Protect Business Assets and Cashflow. Quite often the process can start from simply making business owners aware that there is option available, through to business specific solutions and education. We are here to let business owners know that there can be a better way to secure their financial future.
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