Chancery Division.

Judgment delivered 6 April 1982.

Income tax – Interest free loan to company – Lender sole beneficial shareholder – Whether loan a ‘settlement’ – Whether ordinary commercial transaction – Whether any element of bounty involved – Income and Corporation Taxes Act 1970 – sec. 454(3).

  This was an appeal by the Crown from the finding of the Special Commissioners that income derived by a company from the investment of a loan made to it could not be regarded as income of the lender.

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