Stamp Duty: Company Purchase of Own Shares held on an Overseas Branch Register
HM Revenue & Customs (HMRC) has previously taken the view that, where a company buys back its own shares held on an overseas branch register, then the return that the company is required to send to Companies House is chargeable with Stamp Duty at the rate of 0.5% under the provisions of section 66 FA 1986.
This view has recently been challenged and HMRC has taken legal advice. HMRC now considers that a company's purchase of its own shares held on an overseas branch register is relieved from Stamp Duty by Section 133 Companies Act 2006 (formerly paragraph 8 of Schedule 14 of the Companies Act 1985).
Claims to repayment of Stamp Duty paid made within two years of the date of the instrument (S10 Stamp Duty Management Act 1891) may be now made by any company that has purchased its own shares held on the company's overseas branch register.
How to claim a refund
To claim a refund it will be necessary for the original return submitted to Companies House to be sent to HMRC as that instrument bears the relevant stamps which will need to be cancelled. Companies House will not release these documents direct to the company they will however, send the documents directly to HMRC on request. The request must be made within two years of the date of the instrument (S10 Stamp Duty Management Act 1891).
- If a company wants to make a claim you should write to HMRC with the following information:
- the amount and type of shares bought by the company
- the overseas branch register from which the shares have been purchased/removed
- the amount of stamp duty paid
- the date of the original transaction, and
- a photo copy (should one have been retained) of the stamped document.
You should note your letter “Company Purchase of Own Shares held on Overseas Branch Register” and send to:
Mr J Gair
Birmingham Stamp Office,
9th. Floor,
City Centre House,
30, Union Street,
Birmingham
B2 4AS
HMRC will provide the claimant company with a reference number. The company should write to Companies House quoting the reference number and ask Companies House to send the original document(s) to Birmingham Stamp Office quoting the HMRC reference number and headed “Company Purchase of Own Shares held on an Overseas Branch Register”.
If you have any questions about the reclaim process please contact John Gair, Birmingham Stamp Office at the address above, telephone 0121 616 4522
Source: HMRC. www.hmrc.gov.uk. Copyright acknowledged.