Income Tax (Earnings and Pensions) Act 2003

178Exception for loans where interest qualifies for tax reliefU.K.
This adran has no associated Nodiadau Esboniadol

A loan is not a taxable cheap loan in relation to a particular tax year if, assuming interest is paid on the loan for that year (whether or not it is in fact paid), the whole of that interest—

(a)is eligible for relief under section 353 of ICTA (general provision for relief for payments of interest, excluding MIRAS),

(b)would be eligible for relief under that section but for the fact that it is a payment of relevant loan interest to which section 369 of ICTA applies (mortgage interest payable under deduction of tax),

(c)is deductible in computing the amount of the profits to be charged under Case I or II of Schedule D in respect of a trade, profession or vocation carried on by the person to whom the loan is made, or

(d)is deductible in computing the amount of the profits to be charged under Schedule A in respect of a Schedule A business carried on by that person.