STSM017030 - Introduction to Stamp Duty on shares and Stamp Duty Reserve Tax (SDRT): how to pay: wait and see - provisional stamping

Overview

If instruments are needed by the customer for another purpose whilst waiting for stamping on the 바카라 사이트渨ait and see바카라 사이트� basis, an application may be made for them to be stamped on a provisional basis instead. To do this HM Revenue and Customs (HMRC) must:

  • have agreed that the 바카라 사이트渨ait and see바카라 사이트� basis is appropriate
  • have received a sum representing a reasonable estimate of the duty which will eventually be payable
  • have received a written undertaking that when the consideration is determined the instruments will be re-presented without undue delay, and that any additional duty and interest payable will be paid at that time.

When HMRC provisionally stamps an instrument the confirmation letter will include a reference number. This should be quoted when the instruments are re-presented for final stamping.

Undertaking

There are two options available:

Option 1

Prior to release of the provisionally stamped instrument, a written undertaking is sent to HMRC from an agent acting on behalf of the purchasing client (where the purchasing client wants to rely on his agent to give the undertaking).

In this situation, the application and undertaking from the agent must additionally include a separate written declaration or undertaking from the purchasing client. This must confirm that if the original agent no longer acts for the purchasing client when the final consideration聽is determined, the purchasing client will assume responsibility for resubmitting the instruments without delay and pay any additional Stamp Duty and interest due to HMRC.

The declaration/undertaking must be from a responsible officer of the purchasing corporate entity that is seeking to rely on the provisionally stamped instruments.

OR

Option 2

Where an agent submits an application for provisional stamping on behalf of their purchasing client, the application includes an undertaking from the purchasing client.

The undertaking must be from a responsible officer of the corporate entity purchaser that is seeking to rely on the provisionally stamped instruments.

It must include an undertaking to resubmit the instruments to HMRC and pay any additional Stamp Duty and interest due when the final consideration amount is determined.

It is important that the undertaking is strictly adhered to as the stamping process is not complete until the instruments are re-presented to HMRC for final stamping, even if the Stamp Duty payable remains the same once the consideration has been finalised.

No undertaking received

If no undertaking is provided, then HMRC will not agree to any request for provisional stamping.

Requests for adjudication

Any requests for adjudication under section 12 Stamp Act 1891听(蝉别别 STSM022010)聽will not be accepted at the time of听辫谤辞惫颈蝉颈辞nal stamping 바카라 사이트� adjudication may only take place at the time of final stamping.

Interest

The interest position is聽the same as under 바카라 사이트渨ait and see바카라 사이트�. Interest is due on additional duty payable at the time of final stamping, and will be added to聽any repayments of overpaid duty.

Delays in finalisation of consideration

HMRC would usually expect completion accounts to be agreed within three months of finalisation but does accept that the process may occasionally take longer. To avoid unnecessary reminders being sent HMRC should be informed if there is likely to be any undue delay in accounts being agreed.