SE21740 - Benefits: loans released or written off

Section 19(1)1 ICTA 1988

Sometimes a loan or part of a loan is released or written off. This means the borrower does not have to repay the lender. It is also sometimes referred to as a loan being waived.

If the loan was made by the employer and the release or writing off can only be ascribed to the fact that the borrower is an employee, the amount released or written off will be an emolument chargeable under Section 19(1)1 ICTA 1988. This is so whether or not the employee is within Part V Chapter II ICTA 1988 ( SE01490).

Where a charge arises under Section 19(1)1 on the full amount released or written off the instructions at SE21741 onwards do not apply.

Where the full amount released or written off is not chargeable under Section 19(1)1 look at SE21741 onwards.