Positive commandment · Mitzvat Aseh #141 of 613
To remit all financial [obligations] in the seventh year
להשמיט כספים בשביעית
The verse · Devarim 15:2
וְזֶה דְּבַר הַשְּׁמִטָּה שָׁמוֹט כׇּל־בַּעַל מַשֵּׁה יָדוֹ אֲשֶׁר יַשֶּׁה בְּרֵעֵהוּ לֹא־יִגֹּשׂ אֶת־רֵעֵהוּ וְאֶת־אָחִיו כִּי־קָרָא שְׁמִטָּה לַה׳
“And this is the manner of the release: every creditor that lends anything to his neighbour shall release it: he shall not exact it of his neighbour, or of his brother; because he has proclaimed a release to the Lord.”
The Rambam’s words
To remit all financial [obligations] in the seventh year, as [Deuteronomy 15:2] states: "Every creditor must remit...."
להשמיט כספים בשביעית, שנאמר: "שמוט כל בעל משה ידו" (דברים טו,ב).
Why · Sefer HaChinuch #477
That he release all of his loans in the seventh year
“It is from the roots of this commandment to affix in our hearts and make a strong impression in our minds [about] the matter of the world having been created.”
Who & when
“And this commandment is practiced from Torah writ in the Land of Israel and in every place by males and females at the time that the Jubilee year is practiced.”
Where in the Mishneh Torah
Hilchot Sabbatical Year and the Jubilee הלכות שמיטה ויובל