Foreign investment - Capital Gains or Taxable Income

I’m a UK resident and am considering investing in my wife’s cousin’s company based in Peru. The investment would be a loan between £10,000 and £20,000 with a 10% return payable annually. How would the return be considered and taxed? Would it form part of taxable income or capital gains?

Hi Richard Howard,
The 10% return that you receive would be taxable income.
As the company is based in Peru, this would be foreign interest and you need to convert the amount to sterling.
Thank you.