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HMRC internal manual

Corporate Finance Manual

From
HM Revenue & Customs
Updated
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Deemed loan relationships: repos: tax rules: debtor and debtor quasi-repos: further examples

Debtor repos and debtor quasi-repos: examples

CFM46430 gives an example of a debtor repo where no income arises during the term of the repo.

CFM46440 gives an example of a debtor repo where income arises during the term of the repo and a manufactured payment is received (a “gross-paying” transaction).

CFM46450 gives an example of a debtor repo where income arises during the term of the repo and no manufactured payment is received (a “net-paying” transaction).

CFM46460 gives examples of debtor quasi-repos.

As in the creditor examples (CFM46290), the repo finance charge rate is 6% per annum. As none of the examples lasts for more than 12 months, neither the question of deduction of tax nor of any potential interest long stop (CFM46410) arises.