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16 April 2014
Issue: 4448 / Categories: Tax cases , Employees , Income Tax

P D Curtis (TC3303)

The taxpayer was employed by the Royal Bank of Scotland (RBS) from September 2007 to December 2010.

He decided in 2008 to take out a mortgage with NatWest part of the RBS group. He arranged the loan via the employee helpline and paid interest at 0.94% during 2009/10.

The bank reported the loan as a taxable benefit on the taxpayer’s P11D.

The issue before the First-tier Tribunal was whether the taxpayer was liable to tax on the benefit under the beneficial loans legislation in ITEPA 2003 s 175; the interest paid on the loans was less than the official rate of 4.75% as fixed by the Treasury.

The tribunal decided NatWest would not have made loans on the same low interest rate to other borrowers because all loans by the bank had higher interest rates than the taxpayer’s for the first two years.


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