Home Relocation Loans and Home Purchase Loans
However, the amount of interest, calculated at the prescribed rate (see Loan Made to an Employee), must not be more than the interest the individual would have had to pay if interest had been calculated at the rate of 8%, in the case of a debt contracted before May 1, 1987, or, in all other cases, at the rate prescribed or set at the time the debt was contracted.
If the term of repayment of a home relocation loan or a home purchase loan is more than five years, the outstanding balance at the end of the five years is considered a new loan, in the form of a home purchase loan, contracted on the same day by the individual. The value of the benefit must therefore be calculated using the prescribed rate in effect on the day this new loan is contracted.
You have to include the value of the benefit in boxes A and L and, where applicable, in box G of the employee's RL-1 slip (see courtesy translation RL-1-T). For more information, go to the Benefit Provided to an Employee page.