HMRC states that you have to report on a P11D and pay Class 1A National Insurance on the value of any benefit when a 'beneficial loan' is made to an employee.
But my understanding is that it is not considered a 'Beneficial loan' when the loan is repaid in full on time, with the the required interest (currently 2.5%).
Is it correct that there will be no NI requirement for an employee loan when no interest benefit is derived, correct timelines are adhered to, and the correct paperwork for the loan agreement is generated.? Any other gotcha's..?
Extra: The loan will be made to a director in the business and repaid before 9 months after the company tax year-end.