Policy paper

Stamp Duty exemption for financial institutions in resolution

This measure makes sure that stamp taxes are not chargeable on exercise of resolution powers under the UK special resolution regime.

Documents

Draft legislation

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Explanatory note for Stamp duty - exemption for financial institutions in resolution

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Explanatory note for Stamp Duty Land Tax - exemption for financial institutions in resolution

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Details

Under the Banking Act 2009, the Bank of England has various resolution stabilisation powers to manage a failing financial institution in an orderly way. These ensure that an institution’s operations can be maintained to protect financial stability, depositors and the taxpayer. Upon exercise of a resolution stabilisation power, the Bank of England may arrange a transfer of the failed institution’s issued share capital in exchange for temporary certificates issued to bondholders of the failed institution, or a transfer of securities and/or property held by the failed institution to a temporary holding entity appointed by the Bank of England or to a temporary public body. Both transfer situations are within scope of a charge to Stamp Duty, Stamp Duty Reserve Tax (SDRT) or Stamp Duty Land Tax (SDLT).

Published 6 July 2018