Bill proposing to make loans to shareholders and members of management legal has been passed
The Danish Parliament has passed a bill to amend the Danish Companies Act and the Danish Financial Statements Act, which means that loans may be granted to shareholders and members of management subject to certain conditions. The bill will come into force on 1 January 2017.
If a loan has been granted to a shareholder that is a company subject to fiscal transparency, for instance a partnership or a limited partnership, this also applies in relation to the natural person(s) that might be shareholders in such partnerships or limited partnerships.
The fact that loans to shareholders and members of management are granted in compliance with company law does not cause any changes to the current tax liability. Accordingly, the amendment to the Danish Companies Act primarily implies an advantage for the shareholders that do not have a controlling interest in the company.