Finance (No. 2) Act 2017

Meaning of “outstanding”: loans in currencies other than sterling U.K.

4 (1) In paragraphs 5 to 8 “the loan currency”, in relation to a loan, means the currency in which the initial principal amount of the loan is denominated (whether or not that amount is paid in that currency). U.K.

(2) For the purposes of paragraphs 5 to 8, the value of an amount in a particular currency is to be determined by reference to an appropriate spot rate of exchange.

5 (1) This paragraph applies in relation to a loan where the loan currency is a currency other than sterling. U.K.

(2) But this paragraph does not apply if paragraph 8 applies in relation to the loan.

(3) The amount of the loan that is outstanding, at the relevant time, is to be calculated in sterling as follows—

• Step 1 Calculate, in the loan currency, the amount that is outstanding at that time.

• Step 2 Take the value in sterling, at that time, of that amount.

(4) For the purposes of this paragraph and paragraph 8, the “relevant time” in relation to a loan is the time immediately before—

(a) the end of the approved repayment date, if the loan is an approved fixed term loan on 5 April 2019, or

(b) the end of 5 April 2019 in any other case.

(5) See paragraph 6 for provision about repayments made in a currency other than the loan currency.