Ask Allan Forum
Get expert answers to your tax questions straight from Allan, our owner and experienced CPA. It’s free, direct, and designed to help you make the best decisions when it comes to your taxes.
How does the loan given to an employee of a corporation works weather this employee who's in payroll list being a family member with non-voting shares? The loan is being used for investment. How can you help me as a bookkeeper of the corporation to setup this?
Hi Kam,
In this case, the family member is using the loan for a personal investment. The key question here is whether the loan is used for a purpose that is tied to the corporation's business or personal activities. Since this loan is being used for a personal investment (not related to the business), the CRA is likely to view the loan as potentially being a personal benefit to the family member. The family member must include the amount of the loan in his/her income.