In these difficult times, debt is a critical issue for taxpayers large and small. This paper takes a practical approach to examining the tax consequences of dealing with debt from the onset of financial difficulties through to the restructuring of financial arrangements and ultimately, if necessary, to insolvency. The issues for both debtors and creditors are considered. Specific topics include:
- changes to lending arrangements
- refinancing issues (debt for debt/equity for debt)
- waiver and debt forgiveness
- assignment of a loan Insolvency and administration.