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HMRC internal manual

Stamp Taxes on Shares Manual

Companies and shareholders: company takeovers: Stamp Duty on block transfer

Once a takeover offer is declared unconditional, all the acceptances received up to that date are usually included in one ‘block transfer’- a single stock transfer form with an accompanying schedule setting out the total number of shares in the target company to be transferred to the offeror, together with the considerations payable for each.

The stock transfer form is an instrument of transfer on sale for stamp duty purposes. Stamp duty is chargeable at 0.5 per cent of the amount or value of the consideration for each transfer (FA99/SCH13 PARA3). The separate amounts of duty payable in respect of each individual transfer are set out in the schedule accompanying the stock transfer form, which is stamped with the total amount of duty. See STSM077040 - STSM077060 for how stamp duty is calculated on each type of consideration.

Further block transfers will often be executed, for example covering acceptances received during a specified period after the offer is declared unconditional, and/or to cover compulsory acquisitions from minority shareholders under CA06/S979.