Glossary · UK
What is S455 Tax (Director's Loan)?
A corporation tax charge on close company loans to directors that remain unpaid nine months after the year end.
Full Definition
S455 tax (named after section 455 of the Corporation Tax Act 2010) is a charge on a close company when it makes a loan to a director or shareholder that is still outstanding nine months and one day after the end of the accounting period. The rate is set to match the dividend upper rate (currently 33.75%) and is paid by the company, not the individual, though it is refundable once the loan is repaid, written off, or otherwise cleared — refunds are claimed via the Corporation Tax return process and are paid after a delay rather than immediately.
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Disclaimer: Definitions are for guidance only. For decisions about your tax, savings, property or pension situation, always consult a qualified professional or refer to gov.uk.