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HMRC internal manual

Stamp Taxes on Shares Manual

Introduction to Stamp Duty on shares and Stamp Duty Reserve Tax (SDRT): Stamp duty - payment and penalties: acceptable and unacceptable excuses for delay

SA1891/S15B (5) states that there will be no penalty if there is a reasonable excuse for the delay. Examples of what HMRC regards as acceptable and unacceptable excuses are as follows:-

Acceptable excuses

  • Serious illness, such as a heart attack, stroke or other life threatening condition, or death either prevented the agent from acting or receiving instructions from their client.
  • Industrial action at the Post Office or other document carrier occurred after the document had been posted to Stamp Taxes or delivered to the document carrier for transmission to Stamp Taxes.
  • The original document was destroyed or damaged beyond use due to fire or flood or other natural disaster.

Unacceptable excuses

  • Documents held by another Government Department, for example where Companies House have already processed it
  • The document has not been presented because payment is awaited from clients or the duty is being paid by someone else
  • A valuation of shares is awaited - the documents should have been presented in advance of the resolution of that issue
  • The documents were dealt with by the parties’ previous agent and have been found to be unstamped
  • The documents were previously dealt with by an employee who has since left the employ of the agent and the documents have only now been found to be unstamped
  • There is a disagreement between two sets of agents and the documents have been held until the problem was resolved.
  • The delay is due to the seller or the sellers agent

All the above should also be taken in context. The fact that there was an acceptable excuse will not prevent the imposition of a penalty if an undue period is allowed to elapse after the factor preventing presentation of the document has ceased to be a barrier.