On 26 September 2008 HMRC published Brief 47/08 relating to deduction of tax at source from interest treated as a distribution under section 209(2) of ICTA 1988. The Brief gives a reassurance that HMRC considers that section 874 of the Income Tax Act 2007 does not require deduction of tax at source from interest recharacterised as a distribution.
This confirmation will be welcome for corporate payers and recipients of interest.