By virtue of FA86/S95A and FA86/S97AA there is no Stamp Duty Reserve Tax (SDRT) charge at the rate of 1.5 per cent when securities in a United Kingdom (UK) incorporated company held in a depositary receipt or clearance service scheme are cancelled and replaced by ‘new securities’ that are issued, transferred or appropriated by the same company.

This situation commonly occurs where a company decides to undertake a ‘stock split’ of its issued share capital, for example, by cancelling, say, every ordinary 50p share in circulation and replacing it with two ordinary 25p shares to the same value, or by re-denominating its share capital into a different currency.

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