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The Taxes (Interest Rate) (Amendment) Regulations 2017

S.I. 2017/305 · Made 8 March 2017

Original text. legislation.gov.uk does not revise statutory instruments, so later amendments are not shown here. Changes made to it are listed under each provision when known.

Income Tax

Made 8th March 2017

Laid before the House of Commons 9th March 2017

Coming into force 6th April 2017

These Regulations are made by the Treasury in exercise of the powers conferred by section 178(1) and (2)(s) of the Finance Act 1989f1.

Annotations to the whole text

Footnotes

f1

1989 c. 26; paragraph (s) of section 178(2) was inserted by paragraph 162(d) of Schedule 6 to the Income Tax (Earnings and Pensions) Act 2003 (c. 1).

Contents

  1. 1Citation and commencement
  2. 2Amendment of the Taxes (Interest Rate) Regulations 1989
  3. Signature
  4. Explanatory note

1Citation and commencement

These Regulations may be cited as the Taxes (Interest Rate) (Amendment) Regulations 2017 and come into force on 6th April 2017.

2Amendment of the Taxes (Interest Rate) Regulations 1989

In regulation 5 of the Taxes (Interest Rate) Regulations 1989f1, in paragraph (1) for “on and after 6th April 2015, be 3.00 per cent per annum” substitute “on and after 6th April 2017, be 2.50 per cent per annum”.

Signature

Robert Syms

Andrew Griffiths

Two of the Lords Commissioners of Her Majesty’s Treasury

8th March 2017

Explanatory note

(This note is not part of the Regulations)

These Regulations amend the Taxes (Interest Rate) Regulations 1989 (S.I. 1989/1297) (the “1989 Regulations”).

Chapter 7 of Part 3 of the Income Tax (Earnings and Pensions) Act 2003 (c. 1) (“ITEPA”) provides that tax is chargeable on an employment-related loan to the extent that the interest rate it carries is lower than the official rate. Section 181 ITEPA in effect defines that official rate as the rate prescribed in regulation 5 of the 1989 Regulations.

Regulation 2 reduces the generally applicable official rate of interest from 3.00 to 2.50 per cent per annum with effect from 6th April 2017. It does not affect the modified official rates that apply in relation to Japan and Switzerland, which are prescribed in regulation 5(2) of the 1989 Regulations.

A Tax Information and Impact Note has not been prepared for this instrument as it contains no substantive changes to tax policy.