A loan from a director to the company is reported in Form DPT-3 every year by 30 June — even though a director's loan is not a "deposit" under the Companies (Acceptance of Deposits) Rules, 2014. The annual return captures the lender's name, amount outstanding, interest rate and repayment terms, requires an auditor's certificate and Class 3 DSC, and a separate TDS obligation under s.194A ITA 1961 can attach to the interest the company pays on it.
What the law actually requires
The trigger is "money received", not "deposits". Rule 16 of the Companies (Acceptance of Deposits) Rules, 2014, read with s.73 CA 2013, requires every company (other than a government company) to file Form DPT-3 — the Return of Deposits — reporting all amounts outstanding at 31 March that are either deposits or exempted receipts. A director's loan is exempted from the definition of "deposit" by Rule 2(1)(c)(viii), but it is still reportable as an exempt receipt. The exemption is from the deposit-acceptance machinery of s.73; it is not an exemption from disclosure.
The director declaration. Rule 2(1)(c)(viii)'s exemption is conditional: the director must give the company a written declaration that the money loaned is not from borrowed funds. Without that declaration on file, a director's loan can lose its exempt status and be treated as a deposit — dragging the company into s.73's deposit-acceptance compliance.
What DPT-3 asks for. For each receipt, including director loans:
Filing mechanics. DPT-3 is filed annually on MCA21, due 30 June for the year ended 31 March (for FY 2025-26, the deadline was extended to 31 July 2026 by MCA General Circular 02/2026 following the June 2026 data-centre fire; the statutory default remains 30 June). It requires an auditor's certificate for the figures and a Class 3 DSC on the V3 portal.
Worked example: Arjun lends ₹30 lakh to Devan Trading Pvt Ltd
Arjun, a director of Devan Trading Pvt Ltd, advances ₹30,00,000 to the company on 1 July 2025 at 9% per annum, repayable on demand. His written declaration that the funds are his own (not borrowed) is on file. At 31 March 2026:
- Outstanding principal: ₹30,00,000.
- Interest accrued for FY 2025-26: ₹30,00,000 × 9% = ₹2,70,000, of which Devan pays ₹2,25,000 (Apr–Dec 2025, 9 months) during the year and accrues the rest.
- DPT-3 entry: report ₹30,00,000 principal + interest terms as an exempt receipt under Rule 2(1)(c)(viii), with the auditor's certificate.
- TDS u/s 194A: Devan pays interest of ₹2,25,000 to Arjun in FY 2025-26. The threshold for interest paid by a company (a non-bank) is ₹40,000 per year (raised from ₹5,000 by Finance (No. 2) Act 2024 w.e.f. FY 2025-26). Devan must deduct TDS at 10% on the interest — ₹22,500 — and deposit it. The full-interest
> SBI rateangle does not change the TDS test: s.194A keys off the aggregate interest threshold, not the rate relative to SBI.
Practical implications
- "We don't take deposits" is not a defence. The money in the books as an unsecured director loan is exactly what DPT-3 exists to capture. A debt-free company with zero outstanding receipts is the rare exception, not the rule.
- The missing declaration is the real risk. A director loan without the written Rule 2(1)(c)(viii) declaration can be treated as a deposit. If it is, the company has accepted a deposit without complying with s.73 — and s.76A exposure (penalty of ₹1 crore or twice the deposit amount, extendable to ₹10 crore; imprisonment for officers in default) becomes possible.
- DPT-3 is not DPT-4. DPT-4 was a one-time transition statement; DPT-3 recurs annually. Filing a DPT-4 years ago does not discharge the annual duty.
- Late filing is arithmetic, not discretionary. Beyond 30 June, additional fees under s.403 apply (₹100 per day of delay, per the Companies (Registration Offices and Fees) Rules, 2014), and Rule 21 of the 2014 Rules adds a continuing fine of up to ₹500 per day for non-filing. The clock does not stop until the form is filed.
- MCA21 v3 cross-validates. An unreported director loan can contradict AOC-4's balance-sheet figures or MGT-7A — and an inconsistency the system can see is an inconsistency the ROC can act on. The loan also needs board approval and, where the director is a related party, s.188 clearance.
Changed FY 2025-26: The s.194A threshold for interest paid by a non-bank (such as a company paying a director-lender) rose from ₹5,000 to ₹40,000 per payee per year, effective FY 2025-26 (Finance (No. 2) Act 2024). Small director loans paying modest interest may now sit below the TDS line; above it, TDS at 10% applies.
Step-by-step: what to do
- Collect the director declarations under Rule 2(1)(c)(viii) for every director loan — before 31 March, not after.
- Pull the 31 March balance sheet and list every director-loan credit balance: principal, interest rate, repayment terms.
- Test the interest against s.194A: if aggregate interest to the director in the FY exceeds ₹40,000, deduct TDS at 10% and deposit it on time; report it in the quarterly TDS return.
- Get the auditor's certificate for the DPT-3 figures — the form will not be complete without it.
- File Form DPT-3 on MCA21 v3 with a Class 3 DSC by 30 June (use the ROC compliance calendar to track the deadline and late-fee cut-offs).
- Save the SRN and challan as proof of timely filing.
FAQ
Is a director's loan to the company a deposit?
No — under Rule 2(1)(c)(viii) it is exempt from the definition of deposit, provided the director gives a written declaration that the funds are not borrowed. But the exemption is from the s.73 deposit machinery, not from DPT-3 disclosure: the loan is still reported as an exempt receipt.
When is DPT-3 due?
Annually by 30 June, for amounts outstanding at 31 March. For FY 2025-26 the deadline was extended to 31 July 2026 (General Circular 02/2026); the default for future years is 30 June.
Do I need an auditor's certificate for DPT-3?
Yes. The form requires an auditor's certificate for the reported figures, and it must be signed with a Class 3 DSC on the V3 portal.
Does the company deduct TDS on interest paid to a director-lender?
Yes, under s.194A, if the interest paid to the director in the year exceeds the threshold (₹40,000 for interest from a non-bank w.e.f. FY 2025-26). The rate is 10%; 20% if the director has not linked PAN.
What happens if we file DPT-3 late?
Additional fees under s.403 (₹100 per day of delay) plus a continuing fine of up to ₹500 per day under Rule 21. A missing DPT-3 also sits on the company's V3 compliance profile and feeds ROC scrutiny selection.
Sources
- Companies Act 2013, s.73; s.76A (illegal deposit penalties)
- Companies (Acceptance of Deposits) Rules, 2014 — Rule 2(1)(c)(viii) (director loan exemption), Rule 16 (annual return), Rule 21 (penalties)
- MCA General Circular 02/2026 (dated 19 June 2026) — FY 2025-26 deadline extension to 31 July 2026
- Income Tax Act 1961, s.194A — TDS on interest; s.206AA — non-PAN rate
- Finance (No. 2) Act 2024 — s.194A threshold raised to ₹40,000 (non-bank) w.e.f. FY 2025-26
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