Corporation Tax Act 2010 section 458

Relief in case of repayment or release of loan

Section 458 provides relief from the section 455 tax charge on loans to participators where the loan is subsequently repaid, released or written off.

• Where a close company has paid tax under section 455 on a loan or advance to a participator, relief from that tax (in full or in proportion) is available if the loan is repaid, or the debt is released or written off
• The company must submit a claim for this relief within four years from the end of the financial year in which the repayment, release or write-off takes place
• If the repayment, release or write-off occurs on or after the date the section 455 tax became due and payable, the relief cannot be given until nine months after the end of the accounting period in which the repayment, release or write-off occurred
• The claim follows the Schedule 1A TMA 1970 procedure for standalone claims, unless it is included in the company tax return for the period in which the original loan was made and the relief is available at the time the claim is made