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Overview of loan relationships

D1.701 Loan relationships—overview

[For additional key resources on this topic see 'Loan relationships—related content' below.]

The loan relationship legislation¹ applies to loans of money and also to money debts that are evidenced by the issue of a security (eg loan notes issued by a company in order to acquire shares in another company). Money debts that do not arise from a transaction for the lending of money can also be treated as loan relationships² but in such cases only discount, interest and foreign exchange movements are brought into account (see D1.743).

Impairment losses on trade debts and UK and overseas property business debts also fall within the scope of the loan relationships legislation as do releases of such debts (see D1.750).

For accounting periods beginning on or after 1 January 2016 the profits or losses arising on a