§ Mr. Maddenasked the Chancellor of the Exchequer what action has been taken to stop companies from making fake loans and then claiming tax relief on the non-existent interest charges; what information is available to the Treasury about this practice; and what action has been taken in particular cases.
§ Mr. Robert SheldonI am not sure what practices my hon. Friend has in mind. Tax relief is only given where interest charges arise on a loan actually incurred and where these interest charges are paid by the borrower; and under a provision in this year's Finance Act relief is refused for interest paid under tax avoidance arrangements.