In its final report on proposals for reforming the paper certification of stamp duty on share transactions, the OTS has recommended making stamp duty a fully digitised assessable tax, with the territorial scope aligned more closely with stamp duty reserve tax (SDRT) to exclude non-UK shares.
The report makes the following main recommendations:
make the stamp duty process fully digital, with HMRC providing a unique transaction reference to taxpayers on receipt;
introduce group relief and reconstruction relief, currently available only as stamp duty reliefs, directly into SDRT;
allow company registrars to update shareholder registers on sight of evidence that share transfers have been notified to HMRC, or stamp duty paid;
make stamp duty an assessable tax (on the purchaser), removing the need for HMRC to check every transaction and adjudicate all relief claims, with administrative and enquiry procedures modelled on SDLT; and
narrow the territorial scope of stamp duty, adopting the full SDRT definition of chargeable securities, which excludes transfers of non-UK shares.
In addition, the report makes a further series of technical recommendations for simplification. See http://bit.ly/2tzG2Cj.
The majority of share transactions today are handled electronically via the CREST settlement system for SDRT. However, some 100,000 transactions each year still involve the physical stamping of documents. The review was launched in December 2016 and the OTS published its interim report in March.
In its final report on proposals for reforming the paper certification of stamp duty on share transactions, the OTS has recommended making stamp duty a fully digitised assessable tax, with the territorial scope aligned more closely with stamp duty reserve tax (SDRT) to exclude non-UK shares.
The report makes the following main recommendations:
make the stamp duty process fully digital, with HMRC providing a unique transaction reference to taxpayers on receipt;
introduce group relief and reconstruction relief, currently available only as stamp duty reliefs, directly into SDRT;
allow company registrars to update shareholder registers on sight of evidence that share transfers have been notified to HMRC, or stamp duty paid;
make stamp duty an assessable tax (on the purchaser), removing the need for HMRC to check every transaction and adjudicate all relief claims, with administrative and enquiry procedures modelled on SDLT; and
narrow the territorial scope of stamp duty, adopting the full SDRT definition of chargeable securities, which excludes transfers of non-UK shares.
In addition, the report makes a further series of technical recommendations for simplification. See http://bit.ly/2tzG2Cj.
The majority of share transactions today are handled electronically via the CREST settlement system for SDRT. However, some 100,000 transactions each year still involve the physical stamping of documents. The review was launched in December 2016 and the OTS published its interim report in March.
