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

(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