The Income Tax (Interest Relief) Regulations 1982

Application of tax deduction scheme to limited loans

7.—(1) (a) Subject to the provisions of sub-paragraph (b), where before 1st December in any year a lender notifies the Board that it wishes limited loans which it has made to be brought within the tax deduction scheme, the scheme shall begin to apply in the tax year beginning in the next following year to the relevant loan interest payable on those loans in respect of which the Board has given notice as provided by paragraph 7(1)(b) of Schedule 7; but in the case of limited loans to be made on or after the date of the lender's notice to the Board it shall begin to apply after the date specified in the notice, not being a date earlier than 30 days after the date of the lender's notice;

(b) within 30 days of the lender's giving such a notice the Board may notify the lender that the scheme shall not begin to apply in accordance with its notice and, where the Board so notifies the lender, the scheme shall begin to apply only on the date and to the loans which the Board has in writing authorised.

(2) Where a lender has not so notified the Board under paragraph (1)(a) the tax deduction scheme shall not begin to apply in the following circumstances:—

(a) for the tax year 1983/84, in respect of interest on a loan which was a limited loan

(i) when the interest was last charged by the lender to the borrower's account in its records before February 1983, or

(ii) in the case of a loan made after January 1983, when the loan was made;

(b) for the tax year 1984–85 and subsequent tax years, in respect of interest on a loan which was a limited loan when the interest was last charged by the lender to the borrower's account in its records before March in the previous tax year.