Director Loan Declaration Format
Prepare the director's written declaration needed for a loan to the company to be excluded from deposits.
What it is
Money a company receives from its director is not a deposit under the Companies Act, 2013 only if the director gives a written declaration, at the time of giving the money, that it is not out of funds acquired by borrowing or accepting loans or deposits from others. This exemption is in Rule 2(1)(c)(viii) of the Companies (Acceptance of Deposits) Rules, 2014, and the company must disclose the amount in its Board's report.
When it is used
- A director lends money to a private or public company.
- Each further amount lent by the director.
- Supporting the DPT-3 return and the audit file.
What the template covers
- Director's name, address, PAN and DIN
- Amount, date and mode of the loan
- Declaration that it is not out of borrowed funds
- Interest and repayment terms approved by the Board
- Consent to disclosure in the Board's report and DPT-3
Details you will need
The generator asks for the following. Fields marked with an asterisk in the form are required; the rest can be left blank and filled in later in Word.
Declaration
Date of Declaration; Place
Company
Company Name; CIN; Registered Office Address; Type of Company
Lender
Lender is; Name of Director / Relative; S/o, D/o or W/o; DIN (if the lender is a director); PAN; Residential Address; Name of the Related Director (if relative); DIN of the Related Director (if relative); Relationship with the Director (if relative)
Loan Details
Loan Amount (₹); Date of Payment to the Company; Tranches (if paid in parts, optional); Mode of Payment; UTR / Cheque No. (optional); Interest Rate (% p.a., optional); Repayment Terms (optional); Date of Board Resolution approving the borrowing (optional)
Stamp duty, registration and filing
The declaration must be given when the money is lent; a later declaration does not meet the rule. The company discloses the details in its Board's report and reports outstanding money not treated as deposits in its annual Form DPT-3. For private companies, money from a director's relative is covered by a separate exemption.
Generate the Director's Declaration — Loan Not Out of Borrowed Funds (Rule 2(1)(c)(viii))
Fill in the form and download the draft as a Word file. It is a general template, not legal or professional advice; have it reviewed for your facts before you sign or rely on it.
Need this checked against your facts, or the registration or filing that follows (e.g. the MCA e-form filing)? Contact SKAG and Associates
Related documents
Frequently asked questions
Is a loan from a director a deposit?
Not if the director declares in writing, when lending, that the money is not borrowed from others. Without the declaration it can be treated as a deposit.
Does the declaration need to be given for every loan?
Yes. A fresh declaration is given each time money is lent.
Where is the loan reported?
In the Board's report and in the annual return of deposits, Form DPT-3, filed with the ROC.
This page gives general information for reference only. Laws, stamp duty rates and filing requirements change and differ between States, so confirm the current position for your case. Related: all document templates · free tax calculators · compliance calendar and guides.