Section 180 — Income Tax (Earnings and Pensions) Act 2003: Threshold for benefit of loan to be treated as earnings

Threshold for benefit of loan to be treated as earnings 180 1 Section 175 does not have effect in relation to an employee and a tax year—

a if the normal £10,000 threshold is not exceeded, or b where the loan is a non-qualifying loan and that threshold is exceeded, if the £10,000 threshold for non-qualifying loans is not exceeded.

2 The normal £10,000 threshold is not exceeded if at all times in the year the amount outstanding on the loan (or, if two or more employment-related loans which are taxable cheap loans are outstanding in the year, the aggregate of the amount outstanding on them) does not exceed £10,000 .

3 The £10,000 threshold for non-qualifying loans is not exceeded if at all times in the year the amount outstanding on the loan (or if two or more employment-related loans which are non-qualifying loans are outstanding in the year, the aggregate of the amounts outstanding on them) does not exceed £10,000 .

4 In this section a “ non-qualifying loan ” means a taxable cheap loan which is not a qualifying loan.

5 For the purposes of this section a loan is a “ qualifying loan ” in relation to a particular tax year if, assuming interest is paid on the loan for that year (whether or not it is in fact paid), the whole or part of that interest—

a is eligible for relief under section 353 of ICTA or section 383 of ITA 2007 (relief for interest payments) , b would be eligible for relief under section 353 of ICTA but for the fact that it is a payment of relevant loan interest to which section 369 of ICTA applies (mortgage interest payable under deduction of tax),

c is deductible in computing the amount of the profits to be charged to tax in respect of a trade, profession or vocation carried on wholly or partly in the United Kingdom by the person to whom the loan is made, or d is deductible in computing the amount of the profits to be charged to tax in respect of a UK property business (within the meaning of Chapter 2 of Part 3 of ITTOIA carried on by that person. 2005 or Chapter 2 of Part 4 of CTA 2009)