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<\/a><\/p>\nCompanies often require additional capital to support their operations or investments. Shareholders can provide these funds through:<\/p>\n
What Are Shareholder Loans?<\/strong><\/p>\n These are loans granted by shareholders to the company. They are recorded as liabilities and can be repaid at any time, unless restricted by the company\u2019s articles. They may bear interest.<\/p>\n From a tax perspective, interest paid may be deductible for Corporate Income Tax purposes and is taxable in the hands of the shareholder.<\/p>\n What Are Supplementary Contributions?<\/strong><\/p>\n These are capital injections made by shareholders without increasing nominal share capital and must be foreseen in the articles of association. They are recorded as equity and can only be refunded if the company has a positive equity balance and the general meeting approves.<\/p>\n They do not bear interest and therefore involve no financial cost to the company.<\/p>\n Advantages of Supplementary Contributions<\/strong><\/p>\n \u2022 Improved solvency:<\/strong> Treated as equity, they enhance financial ratios and creditworthiness.<\/p>\n \u2022 Greater stability:<\/strong> Refunds are conditional on company profitability, avoiding untimely withdrawals.<\/p>\n \u2022 Accounting clarity:<\/strong> Clearly recognised as capital, not debt.<\/p>\n \u2022 No financial charges:<\/strong> No interest or associated costs.<\/p>\n Comparison Tables<\/strong><\/p>\n