S T A T U T O R Y I N S T R U M E N T S 2020 No. 194  INCOME TAX  The Taxes (Interest Rate) (Amendment) Regulations 2020  The Treasury make the following Regulations in exercise of the powers conferred by section  178(1) and (2)(s) of the Finance Act 1989( a ).  1.  These Regulations may be cited as the Taxes (Interest Rate) (Amendment) Regulations 2020  and come into force on 6th April 2020.  2.  In regulation 5(1) of the Taxes (Interest Rate) Regulations 1989( b ), for “on and after 6th April  2017, be 2.50 per cent per annum” substitute “on and after 6th April 2020, be 2.25 per cent per  annum”.  27th February 2020  (This note is not part of the Regulations)  These Regulations amend the Taxes (Interest Rate) Regulations 1989 (S.I. 1989/1297) (“the 1989  Regulations”).  The 1989 Regulations set the official rate of interest for the purposes of Chapter 7 of Part 3 of the  Income Tax (Earnings and Pensions) Act 2003 (c. 1) (“ITEPA”). Chapter 7 provides that tax is  chargeable on an employment-related loan to the extent that the interest rate that it carries is lower  than the official rate of interest. Calculation of the cash equivalent of the benefit of the loan for  any tax year, which is generally the amount of the benefit that will be treated as earnings from the  employment, is the difference between the amount of interest on the loan at the official rate and  the amount of interest paid on the loan for that year. Section 181 of ITEPA in effect defines “the  official rate of interest” as the rate prescribed in regulation 5 of the 1989 Regulations.  Iain Stewart  Rebecca Harris  Two of the Lords Commissioners for Her Majesty’s Treasury  Citation and commencement  Amendment of the Taxes (Interest Rate) Regulations 1989  EXPLANATORY NOTE  ( a ) 1989 c. 26; paragraph (s) of section 178(2) was inserted by paragraphs 156 and 162(d) of Schedule 6 to the Income Tax  (Earnings and Pensions) Act 2003 (c. 1).  ( b ) S.I. 1989/1297; relevant amending instruments are S.I. 1994/1307, 2009/199 and 2017/305.  Made - - - - 27th February 2020  Laid before the House of Commons 2nd March 2020  Coming into force - - 6th April 2020 