Division 7A Loan Calculator

Calculate the Minimum Yearly Repayment

Eligible payments: YYYY-MM-DD,amount per line. Omit balance deductions; blank means none.

Up to 7 years, or 25 with a qualifying registered property mortgage. Eligibility is not assessed.

The loan income year sets the remaining term. The first repayment year follows that year.

Minimum yearly repayment (MYR) balance after prior repayments. First-year adjustment below.

The minimum yearly repayment uses the calculation balance, annual benchmark rate and remaining term. The calculator applies the rate you enter to the whole scenario.

For balance P, annual rate r as a decimal and n remaining years, the annuity formula is P × r ÷ (1 − (1 + r)⁻ⁿ). At a zero rate, the arithmetic is P ÷ n.

In the default example, P is $100,000, r is 0.0837 and n is 7. The unrounded minimum is $19,450.9683, displayed as $19,450.97. With repayment at year end, interest is $100,000 × 0.0837 = $8,370.00. The principal component is $11,080.97 and the scenario closing balance is $88,919.03.

Use the ATO benchmark-rate table for the income year being reviewed. The ATO Division 7A calculator also handles the loan and repayment details used for its calculation.

For a first repayment year, establish the calculation balance after any eligible pre-lodgment repayments. Exclude those first-year adjustment payments from the comparison list. Do not subtract them again. Later years use the relevant prior-year closing balance. This model does not determine which pre-lodgment adjustments are eligible.

Every row uses your entered rate assumption. The output is a numerical scenario, not a verified ATO benchmark-rate schedule or a tax compliance finding.

Read the Loan Schedule

Each row pays the model minimum at year end and carries its closing balance into the next row. The entered rate stays constant, including future years.

A positive comparison difference means entered repayments exceed the model minimum. A negative difference means they fall below it. Neither result decides whether those payments count under Division 7A.

Interest and payments round to cents each year. The final payment clears the remaining model balance. These are scenario balances, not a reconstruction of the director loan account.

The scenario pays the model minimum at each year end. Recorded repayments are compared separately and never alter its balances.

Check Transactions That Change the Result

Earlier repayments change daily interest and the actual closing balance. This scenario assumes year-end payments, so its interest cannot substitute for a dated account reconstruction.

Prior repayments belong in the opening calculation balance where eligible. The dated list shows earlier and later totals separately without deducting either from the balance again.

Under sections 109E, 109N and 109R of the Income Tax Assessment Act 1936, repayment timing and eligibility affect the result. Some repayments funded by similar company borrowing are disregarded. A redraw must be reviewed separately rather than entered as a negative repayment.

The usual maximum term is seven years. A 25-year maximum requires the whole loan to be secured by a registered real-property mortgage. At inception, property value after prior-ranking secured liabilities must be at least 110% of the loan. Use the shorter agreed term where applicable.

The model does not determine whether the written agreement, security or transaction treatment satisfies tax law. It does not calculate a deemed dividend or distributable surplus. Substituted accounting periods and changing loan terms need separate calculations.

Use the director loan account guide to identify the evidence behind repayments and new advances. Keep those records with the exported assumptions before drawing a conclusion about the account.

Dates allocate repayments to income years. They do not change the scenario’s interest or closing balances. Redraws require separate loan analysis.