HMRC’s consultation follows an earlier call for evidence and considers proposals to modernise stamp taxes on shares. This includes whether to have a single tax on securities, rather than the current stamp duty and stamp duty reserve tax regimes.

ICAEW’s response to the consultation focuses on simplifying the tax system to support the growth agenda. The consultation was met positively by members who considered that a single tax on securities, implemented in the right way, could lead to a simplification compared with the existing regime. 

Similarly, there were no objections to a move towards a ‘self-assessed’ tax, but members did re-iterate the need for a robust system to amend returns in any new regime. Corporate transactions can be complicated with earn-out consideration spanning several years. Taxpayers will require a statutory provision to facilitate amendments and deal with any associated changes in liability. 

Members raised another key point that a de minimis should be retained to avoid a disproportionate compliance burden on low-value transactions. This approach would also ensure that HMRC’s resources are targeted towards higher-risk areas. For example, only £50 of tax would be due on a de minimis figure of £10,000 (increased from the current £1,000 threshold). There was support for increasing the threshold rather than removing it altogether. 

The timing of payment and charging point were also areas where members raised concerns. There was little or no support for shortening the payment deadline from the existing 30 days from the date of completion. Members suggested this would likely increase complexity and make compliance more challenging. Similarly, moving the charging point to the ‘point of agreement’ was considered an unnecessary complication and would require updated and potentially difficult definitions. This move could also raise a further funding requirement ahead of completion of a transaction.  

Members also suggested that having a statutory clearance for reconstruction and acquisition relief under s75 and s77, Finance Act 1986, would appear reasonable. It would allow a single HMRC team to consider all clearances in connection with one transaction. Should a separate non-statutory clearance be required for stamp taxes, it is likely that this would be performed by a separate HMRC team. This would therefore demand duplication of already constrained resources. 


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