Payment of interest in kind
6After section 370 of ITTOIA 2005 insert—
“370AValuation of interest not paid in cash
(1)This section applies to the payment of an amount of interest in the form of—
(a)goods or services, or
(b)a voucher.
(2)Where this section applies by virtue of subsection (1)(a), the amount of the payment is to be taken to be equal to the market value, at the time the payment is made, of the goods or services.
(3)Where this section applies by virtue of subsection (1)(b), the amount of the payment is to be taken to be equal to whichever is the higher of—
(a)the face value of the voucher,
(b)the amount of money for which the voucher is capable of being exchanged, or
(c)the market value, at the time the payment is made, of any goods or services for which the voucher is capable of being exchanged.
(4)In this section references to a voucher are to a voucher, stamp or similar document or token which is capable of being exchanged for money, goods or services.”