Division 7A Minimum Yearly Repayment Deadline for 2026
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Primary tax-year context: Current Australian tax settings
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If you have a complying Division 7A loan, the practical compliance question is not just “what is the benchmark rate?” but “when does the minimum yearly repayment actually have to be made?”
For private companies with a standard 30 June year end, the repayment must be made by 30 June 2026 for the 2025-26 income year.
The deadline rule
The ATO says minimum yearly repayments on Division 7A loans must be made by 30 June of the income year in which the repayment is due.
That means:
- for the
2025-26income year, the deadline is 30 June 2026 - not after the return is lodged
- not when the accountant finishes the work
- and not whenever the company later documents an offset
Why this matters
Missing the deadline is not an administrative nuisance. It can create a deemed dividend outcome under Division 7A.
That is why the real compliance chain is:
- confirm the current benchmark rate
- calculate the minimum yearly repayment
- make the repayment by
30 June - keep records that show what was paid and when
The benchmark rate still matters
For 2025-26, the Division 7A benchmark interest rate is 8.37% for standard 30 June year-end companies.
That rate feeds into the minimum yearly repayment calculation. So if you use the wrong year’s benchmark rate, you can understate the repayment required and still create a shortfall problem.
What often goes wrong
The most common practical errors are:
- using the wrong benchmark rate
- assuming an offset can be documented later without a proper agreement in place by year end
- paying part of the amount but not the full minimum yearly repayment
- waiting until after
30 Junebecause the loan is still being “reviewed”
The ATO also warns that some payments are not counted for repayment purposes, so not every movement between the shareholder and company automatically fixes the issue.
What to do before 30 June 2026
Use this short checklist:
- confirm the opening balance and remaining term of the loan
- confirm the correct benchmark rate for
2025-26 - calculate the minimum yearly repayment
- make the repayment by 30 June 2026
- keep evidence of payment and any agreement relevant to offsets
If the loan balance or repayment history is messy, do not guess from memory.
The practical decision
If your real question is “am I still safe if I sort this out after year end?”, the safer answer is no.
Division 7A is one of the areas where timing matters as much as the amount. The repayment deadline sits inside the income year, not after it.
Sources
- ATO: Loans and other forms of credit
- ATO: Division 7A benchmark interest rate
- ATO: Division 7A calculator and decision tool
Next step
If you need to test whether the repayment is big enough for 2025-26, use the Division 7A Calculator first, then cross-check the current rate on the benchmark rate guide.