Section 384 | General restrictions on relief under Chapter

(1)Relief is not to be given under this Chapter for interest on a debt incurred—

(a)by overdrawing an account, or

(b)by debiting the account of any person as the holder of a credit card or under similar arrangements.

(2)If the interest paid on a loan in a tax year exceeds a reasonable commercial amount of interest on the loan for the relevant period , relief is not to be given under this Chapter for so much of the interest as represents the excess.^F1

(3)The relevant period is the tax year or, if the loan exists for part only of the tax year, the part of the tax year for which the loan exists.^F2

(4)A reasonable commercial amount of interest on the loan for the relevant period is an amount which, together with any interest paid before that period (other than unrelieved interest), represents a reasonable commercial rate of interest on the loan from the date it was made to the end of that period.^F2

(5)“Unrelieved interest” means interest which because of subsection (2) is not eligible for relief under this Chapter.^F2