SE03124 - Removal or transfer costs: eligible expenses and benefits - bridging loans - loans provided by the employer - procedure

Section 191B and Schedule 11A ICTA 1988

1. Consider whether other qualifying removal expenses and benefits add up to £8,000 or more. If they do, no relief will be due. Assess the benefit of the loan following the normal rules. If not, go to step 2.
2. If the time limit ( SE03104) has not expired and it is likely that there will be further qualifying removal expenses and benefits, assess the benefit of the loan under the normal rules at SE26101 onwards. Reconsider the position when the time limit has expired. Otherwise go to step 3.
3. If the other qualifying removal expenses and benefits total less than £8,000, calculate using the formula

where

• A is the difference between the total of all other qualifying expenses and benefits and £8,000
• B is 365
• C is the maximum amount of the loan outstanding between the date the loan is made and the date when the time limit expires, and
• D is the official rate of interest ( SE26104) in force at the time when the loan is actually made.

Round up the result to the nearest whole number. The answer is treated as a number of days.

4. Take the date on which the loan was made and add to it the number of days calculated at 3.
5. Work out the Section 160 ICTA 1988 charge on the basis that the loan was made on the day calculated at 4 rather than on the actual day when it was made ( SE26101 onwards).

For further guidance see example SE03125.