Corporation tax for P6 (UK) - part 1: self-test

Test your understanding

(1). Fay can deduct the interest on the loan to acquire the shares in GFL from her net income.

Why is Faye entitled to this tax deduction?


(2)
. Why is GFL a close company?


(3)
. GFL made a loan to one of its passive investors, such that it was required to make a payment equal to 25% of the loan to HMRC.

What are the three conditions which would have to have been satisfied in order for this payment not to be necessary?


Answers