Part 8Other reliefs
F1CHAPTER 1AIrrecoverable peer-to-peer loans
The relief
412ARelief for irrecoverable peer-to-peer loans
1
A person (“L”) is entitled to relief under this section if—
a
L has made a peer-to-peer loan (“the relevant loan”),
b
the loan was made through an operator,
c
L has not assigned the right to recover the principal of the loan, and
d
any outstanding amount of the principal of the loan has, on or after 6 April 2015, become irrecoverable.
2
But if the outstanding amount became irrecoverable before 6 April 2016 L is entitled to relief under this section only on the making of a claim.
3
The relief is given by deducting the outstanding amount in calculating L's net income for the tax year in which the amount became irrecoverable (see Step 2 of the calculation in section 23).
4
The deduction under this section is to be made only from income arising from the payment to L of interest on—
a
the relevant loan, and
b
any other loan within subsection (5) or (6).
5
A loan is within this subsection if—
a
it is a peer-to-peer loan made by L, and
b
it was made through the operator through whom the relevant loan was made.
6
A loan is within this subsection if—
a
the loan was made by someone other than L,
b
the right to receive interest on the loan has been assigned to L,
c
the right was assigned through the operator through whom the relevant loan was made, and
d
either—
i
L is a person within paragraph (a), (b) or (c) of section 412I(4), or
ii
the recipient of the loan is a person within one of those paragraphs and the loan is a personal or small loan.
7
The amount deducted under this section is limited in accordance with section 25(4) and (5).
8
In this section “irrecoverable” means irrecoverable other than by legal proceedings or by the exercise of any right granted by way of security for the loan.
Pt. 8 Ch. 1A inserted (15.9.2016) by Finance Act 2016 (c. 24), s. 32(2)