Administration and enforcement of SDRT
Administration and enforcement of SDRT

The following Tax practice note provides comprehensive and up to date legal information covering:

  • Administration and enforcement of SDRT
  • Territorial scope
  • Liability and accountability for the principal charge to SDRT
  • Liability and accountability for the higher rate SDRT charge
  • General rule
  • Exceptions to the general rule
  • Practical implications
  • Notification and payment obligations
  • Due date for payment
  • Overpaid SDRT
  • More...

This Practice Note deals with the administration and enforcement provisions applicable to the principal charge and the higher rate charge to stamp duty reserve tax (SDRT). In this Practice Note, the Stamp Duty Reserve Tax Regulations 1986, SI 1986/1711 are referred to as the SDRT Regs.

Before delving into the detail of how SDRT is administered, it is useful to note that, subject to exemptions, SDRT applies to:

  1. agreements (whether oral or written) to transfer chargeable securities for consideration in money or money's worth at a rate of 0.5%, known as the principal charge, and

  2. transfers or appropriations of chargeable securities into depositary receipt systems or clearance services at a rate of 1.5%, known as the higher rate charge, provided that the transfer is not an integral part of an issue of share capital—the legislation though still reads as if a higher rate SDRT charge applies to an issue of chargeable securities into such a system or service. According to HMRC (and as set out in the Stamp Taxes Bulletin 2/2012), the SDRT treatment on issue of chargeable securities other than UK shares and loan capital will 'be determined on a case by case basis in view of the specific facts of a given case, the terms of the capital duty directive and the decisions in Vidacos and HSBC/Mellon'

The special SDRT regime, known as the

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