Hello Daniele, I am Keith, one of the experts on Just Answer, and pleased to be able to help you with your question.
Loans to companies by directors, shareholders and [misguided - joke] friends are common features in companies setting up in business. It is a quick way of obtaining favourable cash flow. The basics of SEIS, a tax relief measure for individual investors, are set out here:
Having loans by individuals to a company in place does not impinge on the viability of SEIS.
There are a lot of complex rules relating to SEIS and many of them are quoted here;
It is pitifully easy to breach these these restrictions.
I do hope that you have found my reply of assistance.
According to the Gov UK web sites it does not appear so. Making loans to companies and the repayment thereof has no effect on the taxation affairs of either the company or the lenders unless interest is payable on the loan in which case it is income in the hands of the recipient and must be declared on the individuals' self assessment tax return and reduces the profit of the company for Corporation Tax (CT) purposes.
Please be so kind as to rate me before you leave the Just Answer site.
Do you mean receiving rather than perceiving?
Sounds like my daughter who received an EU grant to persue her European Masters degree in Greece, Italy and Holland without any of the argy bargy involved with an UK one!
Remember, if you draw salary from the company (allowable against CT), then if you are a director it must be paid through PAYE channels with appropriate deductions of Income Tax (IT) and NI which you will find a further administrative palaver.
Putting it back as a directors' loan and the tax treatment thereof we have already discussed.
The SEIS has the following provision [source: Gov UK web site]:
'There is a ‘carry-back’ facility which allows all or part of the cost of shares acquired in one tax year to be treated as though the shares had been acquired in the preceding tax year. The SEIS rate for that earlier year is then applied to the shares, and relief given for the earlier year. This is subject to the overriding relief limit for each year. Note that there is no SEIS rate earlier than 2012 to 2013, so there is no scope for carrying relief back before that year.'
I think that covers your point Daniele
Yes they would qualify under the terms set out in that extract except that there would be no requirement to invoke the prior year procedure
Delighted to have been of assistance. It may be useful to employ a local, trusted professional to set up your SEIS for you.
Thank you for your support.