CTM61657 | Close companies: Loans to participators: release or writing-off of loan or advance while temporarily non-resident
From HM Revenue & Customs · Company Taxation Manual
explains that where a loan or advance that is assessable under is released or written off there is an income tax charge under on the person to whom the loan is made.
Where the loan is released or written off while the person to whom the loan is made is temporarily non-resident treats the release or write off as if it occurred in the period of return.
Example
Company X writes off a loan to its participator, Y, on 30 September 2014 while Y was temporarily non-resident. Y returns to the UK on 30 October 2014. The loan is treated as being written off on 30 October 2014 and so the charge under applies on that date.
ensures that the charge on return applies even where the liability could have been relieved by a double taxation relief during the period of non-residence.