Published on 27 Nov 07
by SOUTH AUSTRALIAN DIVISION, THE TAX INSTITUTE
What is a loan and when does it happen?
A client sees a loan as an everyday transaction through a business.
The accountant says a loan is whatever you want it to be!
Recent changes to the tax law and the ATO’s announcement on corrective action make it imperative to know exactly when a transaction is properly a loan, a payment or a fiction.
In this presentation, the accounting treatment of a loan is discussed as well as the taxation implications:
- when does a loan arise?
- recognising loans and distinguishing them from contributed capital
- documenting and substantiating loans
- role of an accountant in creating loans - where does that debit entry go?
- recent Division 7A changes
- issues in forgiving loans
- strategies for solving Division 7A problems as set out in PS 2007/20
- debt equity rules, SME carve outs
- loans as traditional securities - tax issues.
Current at 29 May 2009