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HMRC internal manual

Stamp Taxes on Shares Manual

Exemptions and Reliefs: exemptions: Permanent Interest Bearing shares (PIBs)

Permanent Interest Bearing Shares (PIBS) are building society shares which count as capital. Being mutual institutions, building societies do not and cannot have a ‘share capital’ in the same way as public limited companies. Building society ‘shares’ are effectively debt deposits carrying amongst other things limited voting rights and to the surplus of a Society on dissolution.

Section 109(1) of Building Societies Act 1986 exempts from stamp duty various instruments issued by building societies. This includes including “any transfer of a share in a building society” (section 109(1)(b)) and ‘any other instrument whatsoever which is required or authorised to be given, issued, signed, made or produced in pursuance of this Act or of the rules of a Building Society’.

Section 109(b) and (c) exempt building society shares and bonds respectively. Therefore the transfers of PIBS issued by a building society are exempt from stamp duty (and SDRT) and do not need to be stamped.