Document ID: chunk:federal_register_of_legislation:C2025C00120:section:17:p1
Version: federal_register_of_legislation:C2025C00120
Segment Type: section
Provision Reference: s 17 (pt 1/2)
Character Range: 73557–75897

17  Exempt loan benefits
 (1) Where:
 (a) a loan is made by a person who carries on a business that consists of or includes making loans to members of the public; and
 (b) the rate of interest payable in respect of the loan:
 (i) is specified in a document in existence at the time the loan is made;
 (ii) is not less than the rate of interest in respect of a similar arm's length loan made by the person, at or about that time, to a member of the public in the ordinary course of carrying on that business; and
 (iii) cannot be varied;
the making of the loan is an exempt benefit.
 (2) Where:
 (a) a loan is made by a person who carries on a business that consists of or includes making loans to members of the public; and
 (b) the rate of interest from time to time payable in respect of the loan in respect of a year of tax is not less than the rate of interest applicable at the time concerned in respect of a similar arm's length loan made by the person, at or about the time the loan referred to in paragraph (a) is made, to a member of the public in the ordinary course of carrying on that business;
the making of the loan is an exempt benefit in relation to that year of tax.
 (3) Where:
 (a) a loan consists of an advance by an employer to a current employee of the employer in respect of his or her employment;
 (b) the sole purpose of the making of the loan is to enable the employee to meet expenses incurred by the employee:
 (i) in the course of performing the duties of that employment; and
 (ii) not later than 6 months after the loan is made;
 (c) the amount of the loan does not substantially exceed the amount of those expenses that could reasonably be expected to be incurred by the employee; and
 (d) the employee is required:
 (i) to account to the employer, not later than 6 months after the loan is made, for expenses met from the loan; and
 (ii) to repay (whether by set‑off or otherwise) any amount not so accounted for;
the making of the loan is an exempt benefit.
 (4) Where:
 (a) the making of a loan consisting of an advance by an employer to an employee of the employer constitutes a benefit in respect of the employment of the employee in respect of a year of tax (in this subsection called the current year of tax);
 (b) the sole purpose of the making of the loan is to enable the employee to pay any of the