Section 248A Restriction of relief in respect of loans applied in acquiring interest in companies and partnerships
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Amendments
Section 248A inserted by Finance (No. 2) Act 1998 section 2.
(1) In this section-
"chargeable period" has the same meaning as in section 321(2);
"premises" and "rented residential premises" have the same meanings, respectively, as in section 96.
(2) Where-
(a) a loan, being a loan to which section 247, 248 or 253 applies, is applied on or after the 7th day of May, 1998, to defray money for any of the purposes specified in those sections, and
(b) the money so defrayed is used, in whole or in part, directly or indirectly-
(i) in the purchase, improvement or repair of a premises, or
(ii) in paying off a loan used in the purchase, improvement or repair of a premises,
then, the relief to be given for a chargeable period under those sections in respect of that loan shall, for any chargeable period in which the premises is at any time a rented residential premises, be reduced by the interest attributable to so much of the money used for the purposes specified in subparagraphs (i) and (ii) of paragraph (b).
Is interest relief available on a loan used to invest in a company or partnership which is involved in letting residential premises?
(2) This rule applies where money is borrowed by a company to invest in another company (section 247), or by an individual to invest in a company (section 248) or partnership (section 253)....
(3) This section shall not apply or have effect in relation to interest referred to in subsection (2) which accrues on or after 1 January 2002 and, for the purposes of this subsection, such interest shall be treated as accruing from day to day.
Amendments
Subs (3) inserted by Finance Act 2002 section 17(b).
(4) Notwithstanding subsection (3), subsection (2) shall apply in relation to interest referred to in subsection (2) where the purpose of the loan is the purchase of a residential premises from the spouse of the individual to whom relief is given under section 248 or 253.
Amendments
Subs (4) inserted by Finance Act 2003 section 16(1)(b) in relation to interest which accrues on or after 6 February 2003 and such interest shall be treated as accruing from day to day.
(5) The reference to "spouse" in subsection (4) does not include a spouse to a marriage-
(a) in which the spouses are separated under an order of a court of competent jurisdiction or by deed of separation, or
(b) that has been dissolved under either-
(i) section 5 of the Family Law (Divorce) Act 1996, or
(ii) the law of a country or jurisdiction other than the State, being a divorce that is entitled to be recognised as valid in the State.
Amendments
Subs (5) inserted by Finance Act 2003 section 16(1)(b) in relation to interest which accrues on or after 6 February 2003 and such interest shall be treated as accruing from day to day.
