Income Tax Act 2007 section 866

Qualifying time deposits

Section 866 defines what constitutes a qualifying time deposit and provides that such deposits made before 6 April 2012 are excluded from being treated as relevant investments for income tax purposes.

• A qualifying time deposit made before 6 April 2012 is not a relevant investment and is therefore outside the scope of the rules that apply to relevant investments.
• To qualify, the deposit must be a loan of at least £50,000, with repayment required at a specified time within five years of the date the deposit is made.
• The terms of the deposit must not allow the right to repayment to be transferred to another party, and must prevent any partial withdrawals from, or additions to, the deposit.
• Where the deposit is denominated in a foreign currency, the £50,000 minimum threshold is assessed by reference to the equivalent amount in that foreign currency at the time the deposit is made.