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Departmental Staff (Loans)

Volume 931: debated on Tuesday 3 May 1977

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asked the Secretary of State for Foreign and Commonwealth Affairs whether his Department, as employer, has notified the Inland Revenue of extension of interest-free loans to its employees under Chapter II of the Finance Act 1976 and transmitted to the Revenue tax on the cash equivalent of such loans as defined in Section 66 of that Act.

The Civil Service Department, on behalf of the Foreign and Commonwealth Office and other Government Departments, has notified the Inland Revenue, under Chapter II, of all allowances payable to civil servants, including interest-free advances and loans. The Revenue has told them that the notional interest on these advances and loans will be subject to tax. The provisions of Section 66 of the Act do not, however, take effect until the financial year 1978–79.