The Stamp Duty Reserve Tax Regulations 1986

Made: 2nd October 1986

Laid before the House of Commons: 3rd October 1986

Coming into Operation: 27th October 1986

The Treasury, in exercise of the powers conferred on them by section 98 of the Finance Act 1986, hereby make the following Regulations:—

Citation and commencement

1

These Regulations may be cited as the Stamp Duty Reserve Tax Regulations 1986 and shall come into operation on 27th October 1986.

Interpretation

2

In these Regulations unless the context otherwise requires—

• “Act” means Part IV of the Finance Act 1986;

• “accountable date” means—in relation to a relevant transaction—in connection with which securities are transferred by means of a relevant system operated by the operator of that system, orwhich is reported by means of a relevant system to the Financial Conduct Authority or an exchange by the operator of that system in a case where the securities to which the transaction relates are not transferred by means of a relevant system, orwhich is reported, otherwise than by means of a relevant system, to an exchange, in a case where the securities to which the transaction relates are not transferred by means of a relevant system,the date agreed between the Board and the operator or, if no such date is agreed, the date which is the fourteenth day following the date of the relevant transaction,in relation to interest on overdue tax arising in connection with a relevant transaction which, by virtue of a party to that transaction being a participant in a relevant system, or a member of an exchange, could have been, but was not, reported to the Financial Conduct Authority or an exchange by means of that system, or to an exchange otherwise than by means of a relevant system, the date which is the fourteenth day following the date of the relevant transaction, ... andin relation to a relevant transaction to which neither paragraph (a) nor paragraph (b) applies, the date which is the seventh day of the month following the month in which the charge to tax occasioned by the relevant transaction is incurred , ......

• “accountable person” means— in relation to a charge under section 87 of the Act (“section 87”) — if the person mentioned as B in section 87(1) is a member of an exchange, or if a member of an exchange is acting as an agent for B who is not such a member, that member, and failing that if the person mentioned as A in section 87(1) is a member of an exchange, or if a member of an exchange is acting as an agent for A who is not such a member, that member, and failing that if the person mentioned as B in section 87(1) is a qualified dealer, or if a qualified dealer is acting as an agent for B who is not a qualified dealer, the qualified dealer, and failing thatif the person mentioned as A in section 87(1) is a qualified dealer, or if a qualified dealer is acting as an agent for A who is not a qualified dealer, the qualified dealer, and failing thatthe person mentioned as B in section 87(1),in relation to a charge under section 93(1) to (7) of the Act, the person mentioned in section 93(8) thereof: Provided that if section 93(9) is applicable, then the accountable person means the person to whom the securities are transferred, in relation to a charge under section 93(10) of the Act, the person liable to pay the instalment,in relation to a charge under section 96(1) to (5) of the Act, the person mentioned in subsection (6) thereof:Provided that if section 96(7) is applicable, then the accountable person means the person to whom the securities are transferred, ... andin relation to a charge under section 96(8) of the Act, the person liable to pay the instalment, .........

• ...

• “barrister” includes a member of the Faculty of Advocates;

• “the Board” means the Commissioners of Inland Revenue;

• “carelessly” has the same meaning as in section 118(5) and (6) of the Taxes Management Act 1970;

• “deliberately” has the same meaning as in section 118(7) of the Taxes Management Act 1970;

• “EEA regulated market” means an EU regulated market within the meaning of Regulation (EU) No. 600/2014 of the European Parliament and of the Council of 15 May 2014 on markets in financial instruments;

• “exchange” means—a recognised investment exchange within the meaning given by section 285(1)(a) of the Financial Services and Markets Act 2000, oran EEA regulated market;

• ...

• ...

• ...

• “HMRC” means Her Majesty’s Revenue and Customs;

• “investment business” means business which consists of the carrying on of one or more of the activities specified in Articles 14, 21, 25, 37, 40, 45, 51 and 53 and, in so far as it applies to any of those Articles, Article 64 of the Financial Services and Markets Act 2000 (Regulated Activities) Order 2001;

• ...

• “notice” means notice in writing;

• “operator” means—an Operator for the purposes of regulation 3(1) of the Treasury Regulations operating a relevant system within the United Kingdom;subject to paragraph (c), where a relevant transaction is reported to an exchange otherwise than by means of a relevant system, the operator of that exchange or, if there is no such operator, that exchange;where a relevant transaction is reported to more than one exchange otherwise than by means of a relevant system, the operator of the exchange of which the party who is the accountable person in relation to that transaction is a member or, if there is no such operator, that exchange;

• “qualified dealer” means a person who, not being a member of an exchange— a person who has permission under Part 4 of the Financial Services and Markets Act 2000 to carry on investment business, oris authorised under a legislative provision of the government of a territory outside the United Kingdom to carry on investment business, orwhile not required to be authorised to do so, carries on investment business;

• ...

• “relevant system” has the meaning given by regulation 2(1) of the Treasury Regulations;

• “relevant transaction” means— an agreement falling within section 87(1) of the Act,a transfer, issue or appropriation falling within section 93(1)(b) of the Act, ora transfer or issue falling within section 96(1)(b) of the Act, and in respect of which there is a charge to tax;

• ...

• ...

• ...

• “tax” means stamp duty reserve tax;

• “the Treasury Regulations” means the Uncertificated Securities Regulations 2001;

• “tribunal” has the same meaning as in the Taxes Management Act 1970;

• ...

Due date for payment

3

Tax charged under the Act ... shall be due and payable on the accountable date.

Notice of charge and payment

4

• (1) Subject to paragraph (3), an accountable person, except where different arrangements are authorised in writing by the Board, shall on or before the accountable date—

• (a) give notice of each charge to tax to the Board, and

• (b) pay the tax due.

• (2) A notice under this regulation shall be in such form as the Board may prescribe or authorise and shall contain such information as they may reasonably require for the purposes of the Act.

• (3) This regulation shall not apply where–

• (a) the tax in question has been accounted for by the operator under regulation 4A, ...

• (b) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Power to require information

5

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Notice of determination

6

• (1) Where it appears to the Board that a relevant transaction ... has taken place or where a claim is made to the Board in connection with a relevant transaction ..., the Board may give notice to any person who appears to them in relation to that transaction ... to be the accountable person or, having regard to regulation 4A(1), the operator, or the person liable for any of the tax charged or to the claimant, stating that they have determined the matters specified in the notice.

• (2) If it appears to the Board that any such matter specified in a notice of determination is, or may be, material as respects any liability under the Act of two or more persons, they may give notice of the determination to each of those persons.

• (3) Any matter that appears to the Board to be relevant for the purposes of the Act may be determined and specified in a notice under this regulation.

• (4) A determination for the purposes of a notice under this regulation of any fact relating to a relevant transaction ...—

• (a) shall, if that fact has been stated in a notice under regulation 4 or 4A and the Board are satisfied that the notice is correct, be made by the Board in accordance with that notice, but

• (b) may, in any other case, be made by the Board to the best of their judgment.

• (5) A notice under this regulation shall state the time within which and the manner in which an appeal against any determination in it may be made.

• (6) Subject to any variation by agreement in writing or on appeal, a determination in a notice under this regulation shall be conclusive for the purposes of the Act ... against a person on whom the notice is served.

Relief from accountability

7

If on a claim–

• (a) in relation to a charge under section 87 of the Act, an accountable person or an operator, other than a person liable under section 91 of the Act ...

• (b) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

proves to the Board's satisfaction that he has taken without success all reasonable steps, both before and after the date of the agreement, to recover from the person liable tax for which he is accountable under regulation 4 or 4A, he shall be relieved of his liability to account for and pay that tax and any interest on that tax.

Appeals against determination

8

• (1) A person on whom a notice under regulation 6 has been served may, within 30 days of the date of the notice, appeal against any determination specified in it by notice given to the Board and specifying the grounds of appeal.

• (2) Sections 49D, 49G and 49H of the Taxes Management Act 1970 provide for notification of the appeal to the tribunal.

• (3) Where—

• (a) it is so agreed between the appellant and the Board, or

• (b) the High Court, on an application made by the appellant, is satisfied that the matters to be decided on the appeal are likely to be substantially confined to questions of law and gives leave for that purpose,

the appeal may be notified to the High Court.

• (4) An appeal on any question as to the value of land in the United Kingdom may be notified to the appropriate ... tribunal.

• (4ZA) The appeal may be notified under subsections (3) or (4) only if it could be notified to the tribunal under section 49D, 49G or 49H of the Taxes Management Act 1970.

• (4A) If and so far as the question in dispute on any appeal under this section which has been notified to the tribunal or the High Court is a question as to the value of land in the United Kingdom, the question shall be determined on a reference to the appropriate ... tribunal.

• (4B) In this regulation “the appropriate tribunal” means—

• (a) where the land is in England or Wales, the Upper Tribunal;

• (b) where the land is in Scotland, the Lands Tribunal for Scotland;

• (c) where the land is in Northern Ireland, the Lands Tribunal for Northern Ireland.

• (4C) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

• (4D) On an appeal that is notified to the tribunal, the tribunal shall confirm the determination appealed against unless ... satisfied that the determination ought to be varied or quashed.

• (5) In the application of this regulation to Scotland, for references to the High Court there shall be substituted references to the Court of Session.

Appeals out of time

9

• (1) This regulation applies in a case where—

• (a) notice of appeal may be given to HMRC under regulation 8, but

• (b) no notice is given before the relevant time limit.

• (2) Notice may be given after the relevant time limit if—

• (a) HMRC agree, or

• (b) where HMRC do not agree, the tribunal gives permission.

• (3) If the following conditions are met, HMRC shall agree to notice being given after the relevant time limit.

• (4) Condition A is that the appellant has made a request in writing to HMRC to agree to the notice being given.

• (5) Condition B is that HMRC are satisfied that there was reasonable excuse for not giving the notice before the relevant time limit.

• (6) Condition C is that HMRC are satisfied that the request under paragraph (4) was made without unreasonable delay after the reasonable excuse ceased.

• (7) If a request of the kind referred to in paragraph (4) is made, HMRC must notify the appellant whether or not HMRC agree to the appellant giving notice of appeal after the relevant time limit.

• (8) In this regulation “relevant time limit”, in relation to notice of appeal, means the time before which the notice is to be given (but for this regulation).

Statement of case for opinion of High Court

10

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Interest on overpaid tax

11

• (1) Where tax repaid under regulation 14 is not less than £25 it shall be repaid with interest on it at the rate which is the rate applicable under section 178 of the Finance Act 1989 for the purposes of section 92(2) of the Act¹ from the time it was paid.

• (2) Interest paid under this regulation shall not constitute income for the purposes of income tax or corporation tax.

Recovery of tax

12

• (1) The Board shall not exercise any remedy or take any proceedings for the recovery of any amount of tax which is due from any person unless the amount has been agreed in writing between that person and the Board or has been determined and specified in a notice under regulation 6.

• (2) Where an amount has been so determined and specified, but an appeal to which this paragraph applies is pending against the determination, the Board shall not exercise any remedy or take any legal proceedings to recover the amount determined except such part of it as may be agreed in writing or determined and specified in a further notice under regulation 6 to be a part not in dispute.

• (3) Paragraph (2) applies to any appeal under regulation 8 but not to any further appeal; and regulation 8 shall have effect, in relation to a determination made in pursuance of paragraph (2) of this regulation, as if paragraphs (4) and (4A) of that regulation were omitted.

Underpayments

13

• (1) Subject to paragraphs (2) and (3), where too little tax has been paid in respect of a relevant transaction ... the tax underpaid shall be payable with interest, whether or not the amount that has been paid was that stated as payable in a notice under regulation 4 or 4A.

• (2) Where tax charged under the Act ... is paid in accordance with a notice given to the Board under regulation 4 or 4A and the payment is made and accepted in full satisfaction of the tax so charged, no additional amount of tax shall be determined and specified in a notice under regulation 6 after the end of the period of 4 years beginning with the later of—

• (a) the date on which the payment was made and accepted, and

• (b) the relevant accountable date;

and, subject to paragraphs (2A) and (3), at the end of that period any liability for the additional tax shall be extinguished.

• (2A) In any case of an underpayment of tax brought about carelessly by or on behalf of any person the period mentioned in paragraph (2) shall be the period of 6 years beginning with the date specified under paragraph (2).

• (3) In any case of an underpayment of tax brought about deliberately by or on behalf of any person the period mentioned in paragraph (2) shall be the period of 20 years beginning with the date specified under paragraph (2).

• (4) Paragraph (5) applies to any case not falling within paragraph (2) where too little tax has been paid in respect of a relevant transaction or surrender provided that the case does not involve a loss of tax brought about deliberately by a person liable for the tax (or a person acting on behalf of such a person).

• (5) Where this paragraph applies—

• (a) no proceedings are to be brought for the recovery of the tax after the end of the period of 20 years beginning with the date on which the relevant transaction or surrender was made; and

• (b) at the end of that period any liability for the tax is extinguished.

Overpayments

14

• (1) If on a claim it is proved to the Board's satisfaction that too much tax has been paid in respect of any relevant transaction ... the excess (and any interest paid thereon) shall be repaid by the Board.

• (2) A claim under this regulation shall be made within a period of 4 years beginning with the later of—

• (a) the date on which the payment was made, and

• (b) the relevant accountable date.

Inspection of records

15

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Evidence

16

• (1) For the purposes of the preceding provisions of these Regulations, a notice under regulation 6 specifying any determination which can no longer be varied or quashed on appeal shall be sufficient evidence of the matters specified.

• (2) In any proceedings for the recovery of tax or interest on tax, a certificate by an officer of the Board—

• (a) that the tax or interest is due, or

• (b) that, to the best of his knowledge and belief, it has not been paid,

shall be sufficient evidence that the sum mentioned in the certificate is due or, as the case may be, unpaid; and a document purporting to be such a certificate shall be deemed to be such a certificate unless the contrary is proved.

Determination of questions on previous view of the law

17

Where any payment has been made and accepted in satisfaction of any liability for tax and on a view of the law then generally received or adopted in practice, any question whether too little or too much has been paid or what was the right amount of tax payable shall be determined on the same view, notwithstanding that it appears from a subsequent legal decision or otherwise that the view was or may have been wrong.

Recovery of over-repayment of tax, etc

18

• (1) Where an amount of tax has been repaid, or interest has been paid, to any person which ought not to have been repaid or paid to him, that amount may be determined and recovered as if it were tax due from him.

• (2) Subject to paragraph (3) and (3A) a determination under this regulation may be made before the expiration of 4 years from the date on which the amount was repaid or paid.

• (3) In any case where a repayment is brought about carelessly the period mentioned in paragraph (2) shall be 6 years from the date specified in paragraph (2).

• (3A) In any case where a repayment is brought about deliberately the period mentioned in paragraph (2) shall be 20 years from the date specified in paragraph (2).

• (4) In this regulation an amount repaid or paid includes an amount allowed by way of set off.

Service of documents

19

A notice or other document which is to be served on or given to a person under these Regulations may be delivered to him or left at his usual or last known place of residence or served by post, addressed to him at his usual or last known place of residence or place of business or employment.

Taxes Management Act 1970: provisions to apply

20

• (1) The provisions of the Taxes Management Act 1970² specified in the first column of the Table in Part I of the Schedule to these Regulations shall apply in relation to the tax as they apply in relation to a tax within the meaning of that Act subject to any modification specified in the second column of that Table.

• (2) Any expression to which a meaning is given by the Act or in these Regulations and which is used in a provision of the Taxes Management Act 1970 as applied by this regulation shall in that provision, as so applied, have the same meaning as in the Act or these Regulations.

• (3) The provisions of the Taxes Management Act 1970 specified in ... Part I of the Schedule (as modified where appropriate) are restated as so modified and applied in Part II of the Schedule.

Inland Revenue Regulation Act 1890: provisions not to apply

21

Sections 21, 22 and 35 of the Inland Revenue Regulation Act 1890 (proceedings for fines, etc) shall not apply in relation to stamp duty reserve tax.

SCHEDULE

PART I — TABLE

PART II — TAXES MANAGEMENT ACT 1970