The Australian Taxation Office (ATO) has issued a notice on the need for a Division 7A complying loan agreement.
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Decoding Division 7A – managing loans
Avoid unexpected tax consequences by correctly managing the requirements of a Division 7A loan.
Division 7A can apply to loans, payments or other benefits when an associate or shareholder accesses money from their private company. When not managed correctly, this can result in the transfer of funds being treated as an unfranked divide…