Part 4Pension schemes etc

Chapter 3Payments by registered pension schemes

Introductory

162Meaning of “loan”

(1)

This section applies for the interpretation of this Chapter.

(2)

“Loan” does not include the purchase of or subscription to debentures, debenture stock, loan stock, bonds, certificates of deposit or other instruments creating or acknowledging indebtedness which are—

(a)

listed or dealt in on a recognised stock exchange (within the meaning of F1section 1005 of ITA 2007), or

(b)

offered to the public.

(3)

A guarantee of a loan made to or in respect of a F2person who is or has been a member or sponsoring employer of a registered pension scheme F3, or to or in respect of a person who is connected with a F2person who is or has been a member or sponsoring employer of a registered pension scheme but is not F4such a person, is to be treated as a loan to or in respect of the F2person who is or has been a member or sponsoring employer of an amount equal to the amount guaranteed.

(4)

If a F5person who is or has been a member or sponsoring employer of a registered pension scheme F6or a person who is connected with a F5person who is or has been a member or sponsoring employer of a registered pension scheme but is not F7such a person—

(a)

is liable to pay a debt, the right to payment of which constitutes an asset held for the purposes of the pension scheme, but

(b)

is not required to pay it by the relevant date,

the debt is to be treated as a loan made by the pension scheme to the F5person who is or has been a member or sponsoring employer on that date.

(5)

The relevant date is the date by which a person at arm’s length from the pension scheme might be expected to be required to pay the debt.

F8(6)

For the purposes of this section whether a person is connected with another person is determined in accordance with section 993 of ITA 2007.