Can my company lend me money?
Company loans to directors are restricted by sections 224–225, with specific exceptions. There can also be company tax consequences: section 140B can deem interest income to the company on advances from internal funds to a qualifying director. Obtain advice before drawing funds; approval and repayment arrangements should be documented.
Sources: Companies Act 2016 s.224–225Income Tax Act 1967 s.140B
Also asked as: advance to director tax; company loan to director s224; pinjam duit syarikat sendiri; director current account malaysia.
An accounting entry does not itself make a prohibited loan lawful. Ask the secretary and tax agent to check the company-law exception, the tax definition of director, funding source and interest treatment.
Key facts
- Check sections 224–225 before making a loan
- Section 140B can create deemed interest income for the company
- Document lawful approval, terms and repayment
Call +60 10-383 5988 (a licensed secretary replies within one working hour (Mon–Fri 8:30am–5:30pm MYT; outside hours, first thing next working day)) or walk in at J-3A-15, Solaris Mont Kiara.