Paragraph 5 Arrangements involving loans

(1)

This paragraph applies to any arrangements which include the making, release or writing off of any loan by an employer, or a person connected with an employer, to or for the benefit of an employee or any other person by reason of the employee’s employment.

This is subject to the following qualification.

(2)

This paragraph does not apply if the arrangements are in their entirety ones—

(a)

to which Chapter 7 of Part 3 of ITEPA 2003 (employment income: taxable benefits: loans) applies unless it is the intention of the parties to the loan that the loan should not be repaid either in whole or in part; or

(b)

in respect of which no liability under that Chapter arises by virtue of section 288 or 289 of that Act (limited exemption for bridging loans connected with employment).

(3)

The reference in sub-paragraph (1) to making a loan includes arranging, guaranteeing or in any way facilitating a loan.