CG65956 - Losses: loans to traders: irrecoverability: partial claims

In general you should not accept that a claim under TCGA92/S253 can be made on the basis that a part only of an outstanding loan has become irrecoverable. If the loan is not claimed to have become wholly irrecoverable, it suggests that a part is regarded as remaining recoverable. The grounds that give rise to part of the loan continuing to be recoverable - usually continued trading - will mean in most cases there remains a prospect for recovery of the whole of the outstanding amount. Normally, therefore, it will be appropriate to regard either the full amount, or none, of any outstanding amount of loan as eligible for relief under TCGA92/S253. However, a claim that a part of an outstanding amount of a loan has become irrecoverable may be admitted where

• the debtor has been placed in bankruptcy, receivership or liquidation and
• the receiver or liquidator has announced an anticipated dividend in respect of unsecured debts and has indicated that no further dividends are likely.