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DGA current account is climbing, accountant frowns.

A rising shareholder current account gets tax attention above 700,000 EUR (excessive borrowing law), but below it the tax office still wants commercial terms and interest. Accounting hygiene is crucial.

Try this first

  1. 1Book every personal expense or withdrawal directly to the RC-DGA account, do not mix with cost accounts.
  2. 2Charge yearly interest on the average balance per the tax office's bracket rules, on a separate 'interest RC-DGA' account.
  3. 3Document a loan agreement between DGA and BV with repayment schedule and interest, otherwise the tax office calls it non-commercial.
  4. 4Keep the balance below 700k or plan repayment by December 31 of the year you exceed it, otherwise tax falls as dividend.
  5. 5Discuss with your accountant whether a dividend or salary raise is more tax-efficient than RC growth.

When to bring us in

If RC crosses the threshold or transfer to a holding is on the table, early tax advice is sensible.

See also

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