02/09/2026
You would be surprised how often I open up a new client's financials and find this sitting there.
It's called a debit loan account. Somewhere along the way, money left the business for something personal and instead of running it through wages or a dividend, it just got tucked away as a "loan."
Looks harmless on paper. But the ATO has a specific rule for this (Division 7A) and if that loan isn't structured properly or repaid on time, it can turn into an unfranked dividend in your hands. That's a tax bill you weren't expecting, sometimes years down the track.
If there's a loan account on your balance sheet you can't quite explain, that's worth a conversation before it becomes a problem.