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HMRC internal manual

Community investment tax relief manual

HM Revenue & Customs
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Tax Relief: Loans: Disposal, excessive repayments, and receipt of value

CTA2010/Part 7/Chapter 4/S236; ITA/s354

Where the investment is a loan, no claim for relief under the CITR scheme can be made for any tax year or accounting period if, before the ‘qualifying date’ for that year or period:

  • the investor has disposed of all or part of the loan,
  • the outstanding capital on the loan is reduced to zero, or
  • repayments have exceeded the permitted limits (see CITM7050) for any year. These repayments maybe either conventional loan repayments or amounts of ‘value received’ by the investor treated as repayment of loan capital (see CITM7070).

The ‘qualifying date’ for any tax year or accounting period is the next anniversary of the investment date to occur after the end of that year or period.

FA02/SCH16/PARA22 & ITA/s354 restrict the tax years or accounting periods for which claims to relief may be made. Separate provisions operate to withdraw or reduce relief that has been validly claimed where subsequent events (disposals, repayments, etc) affect an investor’s eligibility for relief under the CITR scheme (see CITM7000+)


An individual makes a loan of £10,000 to a CDFI on 1 January 2004. The terms of the loan provide for the loan to be repaid in full on 1 January 2014. The loan is repaid in full on 30 September 2008.

The qualifying date next occurring after the date of repayment is 1 January 2009 - this is the qualifying date for the tax year ending 5 April 2008 (2007/08). No claim for relief can be made for 2007/08 nor any later year.