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Excessive Company Car Compensation

Fairness between Shareholders

The company has shareholders, one majority and additional shareholders having minority shares in the amount of 5% to 10%

Each shareholder recieves a company car which is renewed approximately every three years.  All shareholders are employees and are copensated for the positions they hold.  The majority shareholder receives a new car each year which necessitates additional company assets to purchase the automobile from $2k to $15k as a down payment and finance payments higher than the minority shareholders.  This is in addition to the agreed compensation provided.

Should the excessive compensation for down payment and additional funding for payments be considered an additional distribution?

Thank you for your imput!

 

 

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Oct 30th 2017 09:26

Yes, I think that you need to consider this additional funding for payments be considered an additional distribution.
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