Document ID: chunk:federal_register_of_legislation:C2004A04616:section:2:p6
Version: federal_register_of_legislation:C2004A04616
Segment Type: section
Provision Reference: s 2 (pt 6/32)
Character Range: 50843–53243

interest (the 'accrued interest') that has accrued on the principal loan in respect of the period exceeds the amount (if any) paid in respect of the accrued interest before the end of the period;

     (c) if any part of the accrued interest becomes payable or is paid after the time when the deemed loan is taken to have been made, the deemed loan is to be reduced accordingly;

  (d) the deemed loan is taken to have been made at a nil rate of interest.

"(6) Paragraph (5)(a) only applies to a period of 6 months if the recipient is under an obligation during the whole of the period to repay the whole or a part of the principal loan.

"(7) For the purposes of this Part, if no interest is payable in respect of a loan, a nil rate of interest is taken to be payable in respect of the loan.

Exempt loan benefits

  "1157H.(1) The making of a loan is exempt if:

    (a) the 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; and

        (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.

  "(2) The making of a loan is exempt if:

    (a) the 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 is not less than the rate of interest applicable at the time the loan is made 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.

  "(3) The making of a loan is exempt if:

  (a) the loan consists of an advance by the employer to the employee; and

    (b) the sole purpose of the making of the loan is to enable the employee to meet the 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; and

    (c) the amount of the loan is not substantially greater than the amount of those expenses that could reasonably be