Loans, whether debit or credit balances, need to be understood not only from a legal viewpoint but also an accounting viewpoint in order to ensure that financial statements that are prepared are correct and accurate and can be relied upon. Are you certain that the financial statements you prepare or rely upon are correct? Are receivables or payables truly loans? Unless financial statements are correctly prepared then Division 7A problems are almost certain to arise. Each "loan' for Division 7A purposes needs to be identified and properly dealt with. Each transaction with a related entity needs to be reviewed and classified to determine whether it attracts Division 7A or another special taxing provision.