CFM33177 | Loan relationships: the matters and computational rules: amounts not brought into account: release of loan to a participator of a close company

CTA09/S321A

Where a close company has released or written off a loan, or part of a loan, made to a participator (see CTM61500), S321A prohibits the company from bringing in any loan relationship debit for the release.

The section has effect for debt releases or write-offs on or after 24 March 2010, and puts it beyond doubt that a close company cannot have a debit in these circumstances. It does not change the income tax treatment on the person to whom the released or written-off loan was made.