Section 14: Relief for Loan Interest: Loan to Buy Interest in Employee-Controlled Company
Summary
1.This section extends the income tax relief for interest paid on loans to buy an interest in an employee-controlled company to interest paid by individuals investing in such companies, wherever they are resident in the European Economic Area (EEA).
Details of the Section
2.Subsection 1 replaces subsection 397(2)(a) Income Tax Act 2007 with a new subsection. This provides that interest may be relieved on loans to acquire an interest in unquoted companies that are resident in the United Kingdom or another EEA State and are not resident outside the EEA.
Background Note
3.This change has been made to ensure that the legislation is compatible with EU law.