1 In land law, a right in or over land. Such a right may be either legal or equitable. The two most important interests in land are the two legal estates, the fee simple absolute in possession (freehold) and the term of years absolute (leasehold). There are also a number of other interests in land that may be legal rather than equitable, the most important of which are legal mortgages and legal easements. Other interests in land are equitable, such as the interests of beneficiaries under a trust of land or a settlement; in such cases the legal estate is held by trustees. See also equitable interests.
2 In general language, a charge made for borrowing a sum of money. For taxation purposes, there is no statutory definition of interest. In Bennett v Ogston  15 TC 374, 379, Mr Justice Rowlatt defined it as “payment by time for the use of money”; Halsbury's Laws of England defines it as “the return or compensation for the use or retention by one person of a sum of money belonging to, or owed to, another”. An excessive payment cannot be interest (Cairns v MacDiarmid  STC 226). The fact that time is used to measure a payment does not suffice to make the payment interest when there is no principal debt (Re Euro Hotel (Belgravia) Ltd  3 All ER 1075 (Ch).