Important Deadline: Prescribed rate loan interest due Jan 30, 2017
- January 30, 2017
If you have set up a “prescribed rate loan” where you have lent money to your spouse, adult child or family trust as part of an income splitting plan, the interest on the loan for 2016 must be paid to you by the borrower on or before January 30, 2017.
If the interest is not paid (and it must be “paid”, not just credited) by January 30th, the income splitting plan will go “offside” not only for 2016 but for all future years – “offside” meaning that you (not the borrower) must now report the income and capital gains earned on the investments made with the loaned funds.
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