STSM042170 | Exemptions and reliefs: reliefs: stock lending and repurchase relief - obtaining relief

For transactions which settle electronically without the completion of paper documents (stock transfer forms), the relief will be from SDRT (section 89AA) whereas for transactions effected on paper, the relief will be from stamp duty (Section 80C).

In the latter situation, each stock transfer form (i.e. outward stock loan to the borrower and inward return of stock to the lender) has to be certified to the effect that the transaction effects a stock loan which is subject to relief under section FA86/S80C. In addition, the CREST Id code of the transferor or transferee party which will report the transaction to a regulated market/MTF etc must be shown on the stock transfer form. The certificate must be in the following format:

‘I/We [insert name of individual or organisation & CREST Participant Code Id] hereby certify that this transfer dated [insert date] is made under an arrangement within the meaning of section 80C Finance Act 1986 (as amended by section 73 and Schedule 21 Finance Act 2007) and that either the stock is regularly traded on the [insert name of the regulated market, multilateral trading facility or recognised foreign exchange] and has been reported to that [delete those not applicable: regulated market, multilateral trading facility or exchange] in accordance with the rules of that [Delete those not applicable: regulated market, multilateral trading facility or exchange],

or

the conditions for relief contained within section 80C(2A) FA 1986 have been satisfied,

and the transfer has been reported under CREST Transaction Id

[ insert CREST Transaction Id reference]’

Authorised signatory …………………………..

Name in block letters …………………………..’

Adjudication (see STSM022010) is required for stamp duty relief. In most circumstances SDRT relief can be obtained automatically for transactions settled within CREST by way of the CREST Transaction type codes ‘SLO’ (Stock Loan) and ‘SLR’ (Stock Loan Return) (See STSM133020). Otherwise repayments of SDRT will be possible where the necessary conditions are met.