CTM61720 - Close companies: loans to participators: two or more close companies

ICTA88/S422 (3)

Two or more close companies may together control a company making a loan within ICTA88/S422 (1) or ICTA88/S422 (2) (CTM61700 or CTM61710). In that case each close company is to be treated for the purpose of ICTA88/S422 as:

• controlling the lending company,
• making a loan of the appropriate proportion of the loan made by that company.

When you decide what is ‘appropriate’, you should consider the nature and amount of the close companies' respective interests in the lending company.