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Division 7A is part of the Income Tax Assessment Act 1936 which relates to loans made by companies or trusts to shareholders or associates of shareholders. It is an anti-avoidance provision that aims to prevent tax-free distributions of company profits as, loans that either remains outstanding or are forgiven altogether.
The agreement conforms to criteria as required by law and can be used in the following circumstances.
- Where a Pty Ltd company makes a loan to its shareholder or an associate of a shareholder;
- Where a company has an unpaid present entitlement from the net income of a trust and a loan is made by the trust to a shareholder or an associate of a shareholder of such company.
Price: $132.00 Including GST (No Charges for Annual Subscribers) Download Order Form
(Print Bundle+$77 Including GST-Same day delivery for Sydney metro area if order placed before 10am)
If a shareholder or an associate of a shareholder borrows money from a Pty Ltd company or where a Pty Ltd company has an unpaid present entitlement to income of a trust and the trust makes a loan to a shareholder or an associate of the f shareholder and such loan is not fully repaid by the lodgement or the due date for the lodgement of the company’s income tax return, whichever is earlier then such a loan can be caught in the provisions of Division 7A. Such a loan will be treated as an unfranked deemed dividend and this situation can entail double taxation of the income. However, loans made under a written agreement executed within the required timeframe, meeting the benchmark interest rate * and maximum term criteria, and which provide minimum yearly repayments can avoid being caught in the provisions of Division 7A.
Before you purchase our Division 7A Loan Agreement, you must ensure that you have taken suitable accounting and legal advice. - We do not provide legal, financial, or accosting advice.
Documents we provide
- Division 7A Loan Agreement
- Division 7A Loan Agreement Execution Page
- Instruction Sheet on what to do next.
Print Bundle:
One Hard loose-leaf Binder plus additional two copies of the constitution
How to Order
Steps:
- Download the forms and invoice from the links. (Annual subscribers do not pay)
- Fill out the form and return it to us along with the payment receipt at companychanges@trustdeed.com.au
- We will prepare it and send it to you
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Registered Tax Agent
Registered ASIC Agent
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Email : sales@trustdeed.com.au
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