Director Loan Calculator UK 2026/27

A UK director loan calculator can show why an overdrawn director’s loan account needs attention before the company’s Corporation Tax deadline. It can model the outstanding balance, a simplified Section 455 charge, the usual repayment timing and a separate beneficial-loan warning. It cannot decide whether a transaction was a loan, dividend, salary, expense repayment or distribution, and it cannot replace the company’s accounts or CT600A.

Use the Director Loan Calculator→ to enter the loan amount, company year end, repayment status and amount repaid. The existing Director’s Loan Account guide explains the wider rules; this page focuses on the calculator workflow and the evidence needed to interpret a displayed S455 result safely.

Key takeaways

What the calculator is estimating

The calculator applies a simplified rate to the selected outstanding loan balance when the scenario says it was not repaid by the deadline. It displays the balance, the separate beneficial-loan threshold and an illustrative S455 amount. It may also show a repayment date based on the company year end.

It does not independently determine:

• whether the company is close or the borrower is a participator;
• whether each withdrawal was a loan rather than salary, dividend or expense repayment;
• which S455 rate applies to each loan made on a different date;
• whether repayments genuinely cleared the loan under anti-avoidance rules;
• interest due to HMRC or the company’s CT payment position;
• the benefit-in-kind value from an interest-free or cheap loan;
• a written-off or released loan’s Income Tax and National Insurance treatment; or
• the correct CT600A, P11D, payroll or Self Assessment disclosure.

Read the result as a prompt to reconcile the loan account, not as a final tax assessment.

Step 1: identify what belongs in the DLA

GOV.UK defines a director’s loan as money taken from or paid into the company that is not salary, a dividend, an expense repayment or money previously put into the company. The loan account records the financial transactions between the director and company.

Start with the ledger, not the bank balance. Add:

A director should not “clear” a loan in the calculator by entering an expected dividend that the company cannot legally declare. Check distributable reserves, board records, shareholder rights, payroll and accounts separately.

Step 2: enter company year end and deadline

The S455 timing is tied to the company’s Corporation Tax accounting period, not the director’s personal tax year. The usual test is whether the loan remains outstanding 9 months and 1 day after the accounting-period end. A company with a 31 March year end and a company with a 30 June year end will have different dates.

Enter the exact company year end, then verify the displayed repayment date against the company’s CT filing calendar. The date is a planning reference; the actual charge depends on the loan balance, the relevant accounting period, repayments and statutory rules.

If the company has several accounting periods or a loan that runs across year ends, create a separate schedule for each period. A single current balance may not be enough to calculate S455 because loan dates and repayments can determine which amount belongs to which period.

Step 3: apply the correct S455 rate by loan date

HMRC’s Company Taxation Manual states that the Section 455 rate follows the dividend upper rate for the tax year in which the loan or benefit was made. It states that the rate is 35.75% for loans made on or after 6 April 2026, while older loans may use earlier rates such as 33.75%.

The calculator uses 35.75% as a current 2026/27 illustration. Do not apply that rate blindly to a historic loan. Build a dated schedule:

If the account contains many drawings and repayments, an accountant should reconstruct the statutory balance rather than relying on the calculator’s one-loan model.

Step 4: understand the £10,000 beneficial-loan boundary

The £10,000 figure is often misunderstood. GOV.UK says that if a shareholder-director owes the company more than £10,000 at any time in the year, the company may need to treat the loan as a benefit in kind, report it and account for National Insurance. The beneficial-loan rules are separate from S455.

The calculator displays the boundary to prevent two common errors:

1. assuming that a loan under £10,000 is exempt from S455; and
2. assuming that a loan above £10,000 produces only a company-level S455 charge.

An interest-free or cheap loan can create a personal taxable benefit based on HMRC’s official interest rate and the actual outstanding balance. HMRC’s published official rate for periods from 6 April 2026 is 3.75%. The company may have reporting and Class 1A National Insurance duties, while the director may have Income Tax or Self Assessment consequences.

Enter the average or relevant balance only when the payroll and P11D calculation supports it. A single year-end balance may not capture the highest balance or the exact period of benefit.

Step 5: test repayment scenarios

Run at least four scenarios:

The purpose of the scenarios is to show the decision deadline and cash requirement. It is not a recommendation to borrow, repay or declare a dividend. The source of repayment matters: a genuine personal repayment, valid dividend, salary or asset transfer can have different tax and accounting consequences.

Step 6: review bed-and-breakfasting risk

HMRC’s guidance includes anti-avoidance rules where a loan of more than £5,000 is repaid and another loan of £5,000 or more is made within the relevant 30-day window. Other arrangements can also be challenged where the repayment is temporary or linked to a replacement loan.

Do not enter “repaid” in the calculator simply because the account briefly reached zero. Preserve:

• repayment date and bank source;
• amount repaid;
• any dividend or salary used to clear the account;
• subsequent advances;
• the 30-day window around the repayment; and
• the commercial reason for the transaction.

If the director needs the money again shortly after repayment, model that as a separate risk scenario and get specific advice. A circular movement of funds is not the same as a permanent reduction in the company’s exposure.

Step 7: distinguish S455 relief from personal tax

When a qualifying loan is repaid, released or written off, the company may be able to reclaim S455 tax under the statutory timing rules. GOV.UK says relief is not necessarily available immediately: the claim can be due 9 months and 1 day after the end of the accounting period in which the loan was repaid, written off or released. Interest paid to HMRC is not necessarily reclaimed with the tax.

A written-off or released loan can also create personal Income Tax and National Insurance consequences. HMRC explains that the company-level Section 455 charge does not replace the separate charge on the recipient for a beneficial loan, and a write-off can be treated differently from an ordinary repayment.

The calculator should therefore show “potential S455” and not “final cost”. Build a timeline for the company charge, repayment, relief date, personal benefit and reporting forms.

Step 8: prepare CT600A and account records

The loan account should appear in the company’s accounts. GOV.UK identifies CT600A as the supplementary form used to show relevant director loans in the Company Tax Return. The calculator does not prepare the form.

Before filing, reconcile:

• opening loan balance;
• all advances and personal expenses;
• payments into the company;
• dividends, salary and expense reimbursements;
• interest charged and paid;
• year-end balance;
• 9-month-and-1-day date;
• S455 rate by loan date;
• beneficial-loan balance and official-rate interest; and
• any written-off, released or replacement loan.

Keep board approvals and shareholder records where a dividend or formal loan is used. If the company is insolvent or close to insolvency, a director loan can create serious legal and fiduciary issues; tax arithmetic should not be used to justify taking more money out.

Common questions

Reconcile the calculator with the company records

The calculator is only as reliable as the director loan account schedule behind it. Reconcile each advance, personal expense paid by the company, dividend or salary credit, repayment, write-off and interest entry to the bank statement and bookkeeping ledger. Record the date and balance, not just the year-end total, because the maximum balance, accounting period and repayment timing can change the tax treatment. Keep separate schedules for each director, shareholder and connected person.

Before relying on a result, compare the model with the CT600A working papers, payroll or benefits reporting, board minutes and the company accounts. A repayment funded by a new withdrawal may not have the same effect as a genuine reduction, and a company-law entry does not automatically settle the employment-tax analysis. Save the input assumptions, official rate used, repayment evidence and the version of the calculation. Re-run it when a balance is cleared, a loan is written off, ownership changes or the accounting period closes.

Official sources

• GOV.UK — Director’s loans: if you owe your company money
• GOV.UK — Director’s loans overview
• HMRC — Section 455 rate and close-company loans
• HMRC — Exclusions for certain loans
• HMRC — Bed-and-breakfasting rules
• GOV.UK — Loans provided to employees
• GOV.UK — What is exempt from beneficial-loan reporting
• HMRC — Beneficial loans and employment tax
• HMRC — Beneficial loan official rates

This guide is educational. It does not prepare CT600A, confirm S455 relief, determine benefit-in-kind reporting or provide company-law or tax advice.