Personal Tax Mock 2014

I cannot seem to work out the answer for this question myself. It's in section 1.2 and the relevant information is:

On 1 November 2011, Roweena had been given a £15,000 loan on which she paid her employer 1% interest. On 1 July 2014, Roweena repaid £3,000 of the loan, but she had made no other repayments.

I have to say what the taxable benefit in kind relating to the loan is. The answer is £304 according the the answer sheet but I cannot seem to work out how to get to that. Any help would be much appreciated.


  • mdandre
    mdandre Registered Posts: 3
    It is considered a taxable benefit receiving a loan for more the 10k at a rate less then 3.25%.
    The assessable benefit is calculated on the difference between the rate on the money borrowed and the official rate(3.25%) multiplied but the amount borrowed during the year.
    The amount borrowed during the year is (15000-12000)/2=13500£, ie an average of the amount actually borrowed during the year, and the difference is 3.25-1.00=2.25; this makes 13500*2.25%=303.75.
  • DSAJ
    DSAJ Registered Posts: 3
    Thank you verymuch! That question was giving me a headache!
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