EIM26113 – The benefits code: beneficial loans: meaning of “employment- related loan”
Section 174(1) and (2) ITEPA 2003
The rules on beneficial loans apply only to an
“employment-related loan” which is a “taxable
cheap loan” (
EIM26102).
An employment-related loan is a loan made to an employee, or
a relative (
EIM26112) of an employee, which is made
by one of the following -
- the employee’s employer or a prospective employer (but there is an important exception to this rule at EIM26114), or
- a company or partnership:
- controlled by the employer, or
- by which the employer is controlled, or
- under the same control as the employer
- a person having a material interest in a close company or in another company or partnership controlling that close company and the employee's employer:
- is that close company, or
- controls it, or
- is controlled by it.
But note the exception to this rule explained at
EIM26115.
The extended meaning of making a loan at
EIM26110 applies for the purpose of
these rules.
For the meanings of material interest in a close company and
control see
EIM20212 to EIM20213.
