ABSTRACT
A borrower need not gross-up if a tax deduction is made in certain limited cir-
cumstances. Eg:
a) a lender is not or has ceased to be a ‘qualifying lender’ (eg: a ‘bank for the
purposes of TA s 840’, or a company entitled to gross payment under ICTA s
349B, or a ‘treaty lender’) other than as a result of a change in law, or
It is market practice for a ‘treaty lender’ to be a lender that is beneficially
entitled to interest, is resident in a jurisdiction which has a tax treaty with
the UK conferring complete exemption from UK tax, and is not party to
the facility agreement through a permanent establishment in the UK.
