Director’s loan calculator
If you still owe your company money 9 months and 1 day after its year end, the company pays s455 at 35.75% on loans made from 6 April 2026 and only gets it back after the loan is cleared. A loan over £10,000 also carries a benefit in kind unless you pay interest at the 3.75% official rate.
Rates for the 2026/27 tax year. Checked 7 November 2026.
| Loan at the year end | £20,000.00 |
|---|---|
| Repaid within 9 months | − £0.00 |
| Still owed 9 months and 1 day after the year end | £20,000.00 |
| s455 at 35.75% | £7,150.00 |
| Due | 1 January 2028 |
| Reclaimable from, if repaid by 31 March 20289 months and 1 day after the end of the period in which you repay | 1 January 2029 |
| Benefit in kind, a full year3.75% official rate less 0% paid | £750.00 |
| Income tax for you at 40% | £300.00 |
| Class 1A NI for the company at 15% | £112.50 |
| s455, paid by the companyrefunded once the loan is repaid | £7,150.00 |
|---|---|
| Benefit in kind tax and Class 1Aa permanent cost each year | £412.50 |
| Dividend tax at 35.75%a permanent cost, paid by you | £7,150.00 |
s455 is a temporary tax on the company. It comes back, without interest, once the loan is repaid, written off or cleared by a dividend, but only 9 months and 1 day after the end of the period in which that happens. The benefit in kind is shown for a full year on the year-end balance. Dividend tax assumes your £500 allowance is used elsewhere.
Worked example: a £20,000 loan with nothing repaid
A director borrows £20,000 from their company on 1 June 2026. The company’s year ends on 31 March 2027 and nothing is repaid in the 9 months after it. The loan was made after 6 April 2026, so s455 is charged at 35.75%: £20,000 times 35.75% is £7,150. It is due on 1 January 2028 alongside the corporation tax. If the director repays the loan during the year to 31 March 2028, the company can reclaim the £7,150 from 1 January 2029.
The loan is over £10,000, so there is also a benefit in kind. A full year at the 3.75% official rate on £20,000 is £750 of interest the director did not pay. A higher-rate taxpayer pays £300 of income tax on it, and the company pays £112.50 of Class 1A National Insurance. Clearing the same £20,000 with a dividend instead would cost the director £7,150 in dividend tax at 35.75%. At the higher rate the two figures match, but the s455 comes back and the dividend tax does not.
Why the result moves
The s455 charge moves with the amount still owed 9 months and 1 day after the year end, so every pound repaid before then saves 35.75p of s455. The loan date sets the rate: move it before 6 April 2026 and the charge drops to 33.75%. The year end sets the due date and the reclaim date. The benefit in kind falls as the interest you pay rises and disappears at 3.75%. Your tax band changes the income tax on the benefit and the dividend comparison, but not the s455, which is the same for every director.
When this calculator is wrong for you
- The balance mixes loans made before and after 6 April 2026. Each part is charged at its own rate; run the calculator once for each.
- Part of the loan was made in an earlier accounting period. s455 on that part was charged in that period, not this one.
- The loan was not outstanding for the whole tax year, or the balance moved a lot. The benefit in kind is worked out for a full year on the year-end balance; HMRC uses the days the loan existed and an average balance.
- You pay Scottish income tax. Scottish rates are not supported yet.
- The company is not a close company, or the borrower is a participator who is not a director. Different rules can apply.
Questions people ask
What is s455 tax?
A corporation tax charge on a close company when a director or shareholder still owes it money 9 months and 1 day after the year end. The company pays it, not the director, and it is charged on the amount still owed on that day.
When is s455 due?
On the same day as the corporation tax for the period: 9 months and 1 day after the year end. For a 31 March 2027 year end that is 1 January 2028. It is reported on the CT600A supplement.
Do I get s455 back?
Yes, once the loan is repaid, released or written off, but not straight away. The refund becomes due 9 months and 1 day after the end of the accounting period in which the loan is cleared, and HMRC pays no interest for the wait. You claim it on the CT600A or, after the return deadline, on form L2P.
What is the s455 tax rate for 2026/27?
35.75% for loans made on or after 6 April 2026, and 33.75% for loans made from 6 April 2022 to 5 April 2026. The rate follows the higher dividend rate, which rose by 2 percentage points, so a balance built up across both dates is charged at two rates. The plain-English gov.uk page on director’s loans still shows 33.75%, and HMRC’s Corporation Tax online service will not accept 35.75% until 6 April 2027, so your accountant may need to file and then amend.
What is the £10,000 benefit in kind rule?
If the loan goes over £10,000 at any point in the tax year, the director is taxed on the interest they did not pay, measured against HMRC’s official rate of 3.75%. The company pays 15% Class 1A National Insurance on the same figure and reports it on a P11D. Paying interest at the official rate or more removes the benefit.
What is bed and breakfasting?
Repaying a loan just before the s455 deadline and borrowing the money back soon after. Where £5,000 or more is repaid and £5,000 or more is borrowed again within 30 days, HMRC matches the repayment to the new loan, so no s455 relief is given on it. A wider rule catches larger loans of £15,000 or more where new borrowing was planned at the time of repayment.
What happens if the company writes the loan off?
The company gets its s455 back on the usual timetable. The director is taxed on the amount written off as if it were a dividend, and HMRC treats it as earnings for Class 1 National Insurance, so a write-off usually costs more than declaring a dividend to clear the loan.
How this is worked out
The amount charged is the year-end balance less anything repaid within 9 months, never below zero. s455 is that amount times the rate for the date the loan was made: 35.75% from 6 April 2026, 33.75% from 6 April 2022. The due date is 9 months and 1 day after the year end, and the reclaim date is 9 months and 1 day after the following year end, using the corresponding-date rule so a period ending on the last day of a month is due on the first day of the tenth month after it. If the loan went over £10,000 at any point in the tax year, the benefit in kind is the year-end balance times the official rate of 3.75% less the interest rate you pay, taxed at your marginal income tax rate, with Class 1A at 15% for the company. The dividend comparison taxes the amount still owed at your band’s dividend rate. Every figure is rounded to the penny.
Full formulas, rounding rules and test cases are on the methodology page. Every rate update is listed in the changelog.