Close company loans to participators incur a special tax charge. Close company loans to participators are entirely distinct from loans by participators to close companies. In the former situation the participator is a debtor of the close company. In the latter, the boot is on the other foot, and the close company ends up owing or paying money to the participator. However, the distinction between the two situations would appear sometimes to be missed in practice, causing undesirable and unnecessary confusion.
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