Commentary

V4.136D Exemption for finance—underwriting

Part V4 Exemption, zero-rating and reduced rates

V4.136D Exemption for finance—underwriting

V4.136D Exemption for finance—underwriting

VATA 1994, Sch 9 Group 5 item 5A—scope of the exemption

Exemption is extended to the underwriting of any issue within Item 1 (see V4.136A) and item 6 (see V4.136E)1.

Underwriting involves the underwriter (or any sub-underwriter) guaranteeing that an issue of shares or other securities will raise a given amount. The guarantee may involve the underwriter finding purchasers for an undersubscribed issue, or purchasing the securities himself (usually with a view to resale). Exemption applies to the underwriting fee in either case. If the fee received by an underwriter is adjusted to reflect his entitlement to

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