CITM7010 - Withdrawal of Relief: Disposal of loan

FA02/SCH16/PARA28; ITA/s360

If, within the five year period beginning on the day the loan was made an investor disposes of the whole or part of the loan (other than as a ‘permitted’ disposal) any community investment tax relief attributable to that loan, for any year or period, must be withdrawn.

A disposal is ‘permitted’ if it is:

• by way of a distribution in the course of dissolving or winding up the Community Development Finance Institution (CDFI);
• a disposal by reason of the entire loss, destruction, dissipation or extinction of the loan (TCGA92/s24(1))
• a deemed disposal because the loan has become of negligible value (TCGA92/s24(2)), or
• made after the CDFI has ceased to be accredited.