You lent money to your company. Can you get it back?
A director’s loan needs evidence, and repayment depends on the company’s circumstances. Do not treat it as cash you can simply withdraw before other debts are addressed.
Corporate Recovery Partners
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The director wants the loan repaid
A director has funded company expenses for years and wants the money back before closing. The accountant’s ledger shows a loan balance, but some transfers were never explained and the company owes suppliers. The director needs to establish what is actually owed and how a repayment would be treated in the current financial position.
Match bank transfers, expense payments and repayments to the ledger. Separate wages, dividends, capital contributions and genuine loans with the accountant. Identify agreed terms and any supporting documents.
Do not rely on a balance-sheet label alone. Missing or inconsistent records should be resolved before asking for repayment. Prepare a clear transaction schedule that another person can follow without knowing the company’s history.
Assess the cash available after all obligations, not just the balance on the day. Include debts already due and costs of completing work or closing. Obtain qualified advice where the company is insolvent or at risk.
ASIC’s director guidance emphasises responsibilities to creditors in financial difficulty. A director’s personal need for the money does not answer whether the company should pay it now. Related-party repayments deserve careful review.
If a practitioner is appointed, provide the supporting loan evidence and ask about the claim process. Do not assume that being the owner gives priority or guarantees a return.
Keep the company claim separate from personal guarantees and other household debts. A proposed settlement or restructuring may treat different obligations differently. Ask for advice on the actual documents and circumstances.
Use a conservative household cash plan while the company position is assessed. Do not promise the recovered loan to a personal creditor before the amount and timing are established.
Retain the evidence and written decisions. If repayment is permitted and made, ensure it is properly recorded. If it is not, the next task is understanding the claim and personal alternatives rather than taking company assets in place of cash.
