Employer Loan

boo_star

Ben8282 wrote: »

Well yes. A very strange loan indeed. The first time I have ever encountered an employer giving an employee a debt consolidation loan repaayable over a period of years.
I wonder if it is legally enforcable. For example, if the employee had resigned the very day after receiving it, could the employer have obtained a ccj? Not saying the employer is a loan shark, after all the loan is at 0%, but very curious as to how the company accounts reflect this loan, what paperwork or formal loan agreement accompanied it, if it is governed by the Consumer Credit Act or not and, above all, just why the employer decided to extend this loan.

As enforceable as any other loan as far as I'm aware.

If I lended you £50 (as an example) you'd owe me £50 at least.

glennstar

Ben8282 wrote: »

Well yes. A very strange loan indeed. The first time I have ever encountered an employer giving an employee a debt consolidation loan repaayable over a period of years.
I wonder if it is legally enforcable. For example, if the employee had resigned the very day after receiving it, could the employer have obtained a ccj? Not saying the employer is a loan shark, after all the loan is at 0%, but very curious as to how the company accounts reflect this loan, what paperwork or formal loan agreement accompanied it, if it is governed by the Consumer Credit Act or not and, above all, just why the employer decided to extend this loan.

In my experience loans like this are common enough. The paperwork around them may often leave a few questions but they are done on the basis that the salary is garnered and the loan is usually repayable if your contract terminates for any reason. I've even seen companies cover this in their employee handbook as providing loans (often not that big) leaves employees content/committed/entangled and it doesn't impact them (the company) materially.

Yes, this is a benefit in kind and jonesMUFCforever is exactly right.

Yes this should be clearly shown on your payslip. The last one I saw (not for some time I grant you) was deducted pre-PAYE post-NI... or certainly post-employers-NI at least.

I would think a 10 minute play with a salary calculator should reveal all.