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Section 455 tax

Estimate a single close-company participator loan's Section 455 charge and its nine-month-and-one-day payment deadline.

Rules, timing and worked examples

Supported calculator scope: One loan advanced in this accounting period, from 6 April 2022, by a close company to a participator. Only genuine cash repayments after period end and within nine months; no reborrowing, repayment arrangements, release/write-off, multiple advances or relief dispute. The balance is for this single loan, not an aggregated director-loan ledger.

Effective scope: loans advanced from 6 April 2022; rate changes 6 April 2026. Last reviewed 26 September 2026.

Rule summary

Rules and effective period

Section 455 is a company-level tax charge on qualifying close-company loans to participators. A director title alone does not establish eligibility. The tool assumes the loan is within these rules.

The rate for advances from 6 April 2022 to 5 April 2026 is 33.75%; advances on/after 6 April 2026 use 35.75%. The advance date determines the rate, not the accounting-period end. Earlier loans and mixed advances require review.

The company payment deadline is nine months and one day after accounting-period end. Qualifying repayments within nine months can reduce the charge; the following payment-deadline day is not inside that repayment window. HMRC CTM61610 aligns this timing with normal Corporation Tax calendar periods, not generic clamped month addition.

Repayment after the window may permit relief, but not an immediate refund: relief is not due until nine months and one day after the end of the accounting period in which repayment occurs. Claims generally have a four-year limit from the end of the financial year of the repayment event.

Repayment and reborrowing can engage anti-avoidance: £5,000 repayments and new loans around a 30-day window, and arrangements involving £15,000 or more, need review. Waiting 31 days is not a universal safe harbour. Beneficial-loan benefits, write-off personal Income Tax/NIC and interest are separate issues.

Worked examples

How the rule behaves in practice

  • Partial genuine repayment: A loan advanced 10 April 2026 has a £20,000 balance at 31 December 2026. £5,000 is genuinely repaid by 30 September 2027, with no reborrowing arrangements. Payment is due 1 October 2027. £15,000 × 35.75% = £5,362.50.
  • Earlier advance: The same outstanding £15,000 relates instead to an advance on 5 April 2026 in an appropriate accounting period. The advance-date rate is 33.75%, giving £5,062.50; later period end does not change that rate.
  • Month-end repayment and payment boundary: A loan advanced 10 April 2026 remains at £20,000 at the 30 November 2026 accounting-period end. Assume genuine repayments and no anti-avoidance arrangements. The qualifying repayment window ends on 31 August 2027; payment is due 1 September 2027. A full qualifying repayment on 31 August eliminates this charge. Repayment on 1 September is outside that window: the £7,150 charge remains payable, with later relief subject to its separate timing and claim rules, not an immediate refund.

Practical consequences

  • A calculator estimate is not an HMRC assessment. Confirm the recorded facts and seek professional review for excluded cases.
  • Filing and payment obligations are distinct; meeting one does not satisfy the other.

Important limits

  • An estimate under entered facts, not an HMRC assessment. Choose No / unsure for facts outside the supported case; professional review is required.
  • Appeals, reasonable excuse, disputed balances and specialist reliefs are not determined here.

Primary sources and review date

Reviewed on . Preserved source review from the accepted scoped statutory repair; this contract migration does not re-date that review.

Applies to: Loans advanced from 6 April 2022, including the loan-rate change from 6 April 2026.

Reviewed scope: One close-company participator loan and genuine cash repayments; no reborrowing, arrangements, write-offs, multiple advances or relief dispute.

Review basis and change triggers

Reviewed model: director-loan-section-455-tax-calculator: loans advanced from 6 April 2022; rate changes 6 April 2026; reviewed 26 September 2026

  • A cited source or statutory regime changes.
  • Reviewed content, runtime adapter or domain implementation changes.
  • A new effective period falls outside the supported scope.

Turn the result into an action plan

  • Use the linked calculator with verified dates and balances.
  • Consult the primary sources below for exceptions and relief; do not assume an automatic refund, reset or appeal outcome.

Use the tool

Director Loan Section 455 Tax Calculator

Estimate a single close-company participator loan's Section 455 charge and its nine-month-and-one-day payment deadline.