
Director loans and Division 7A in 2026: avoiding deemed-dividend traps
Directors in private companies know the nerve-wracking moment when personal use of company funds raises red flags. Division 7A can reclassify these loans as unfranked dividends that incur heavy tax at the top marginal rate. In 2026, increased ATO scrutiny and higher interest rates heighten the risk of costly penalties. Directors can protect profits by ensuring full repayments or establishing a complying written loan agreement. Read on to discover practical guidance and insights.









































