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HMRC internal manual

Capital Gains Manual

HM Revenue & Customs
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Losses: loans to traders: qualifying loans

To qualify for relief under TCGA92/S253 (3), the loan must have been of money and

  • must have been made, on or after 12 April 1978, to a borrower resident in the UK; and
  • must have been used wholly for the purposes of the borrower’s trade, or, provided that the trade is actually carried on subsequently, for the purposes of setting it up. Loans made where the borrower never commences a trade will not qualify.For the purposes of this section, trade includes profession or vocation, but does not include a trade which consists of or includes the lending of money.