(ii) Advise Mr Fencer of the income tax implications of the proposed financing a

(ii) Advise Mr Fencer of the income tax implications of the proposed financing arrangements. (2 marks)

(ii) The income tax implications of the proposed financing arrangementsMr Fencer has borrowed money from a UK bank in order to make a loan to Rapier Ltd, a close company. The interestpaid by Mr Fencer to the bank will be an allowable charge on income as l