CTM98240 - CTSA: Loans to participators: Late payment interest

TMA70/S87A (1)

Interest is charged on any outstanding CTA10/S455 liability from the due date until the earlier of:

• payment of the tax (Section 87A(1)), and
• the date that the loan or part of it is repaid, released or written off (TMA70/S109 (3A)).

For the purpose of applying the second rule, any tax that is unpaid at the date on which a repayment etc. occurs is assumed to be, as far as possible, Section 458 tax, rather than CT or tax under ICTA88/S747 (for accounting periods ending on or before 31 December 2012).

Even when relief is deferred under Section 458 (5) interest is only calculated until the date of repayment, release or set-off, see CTM61605 onwards.