Page 57 - F6 Slide - Taxation - Lecture Day 3 F
P. 57
Income from Employment
Fringe
• Low – interest debts
• A taxable benefit arises when an employee is
offered a free interest loan by the employer for
interest that is lower than the official rate.
• Official rate of interest =Repurchase rate + 100
basis points.
• Cash equivalent=Interest on the loan-official rate
of interest.
• If the employee uses the loan in the production of
income the interest is deductable.
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