Explanatory note

(This Note is not part of the Regulations)

These Regulations, which come into force on 1st January 1993, amend the Stamp Duty Reserve Tax Regulations 1986 (S.I. 1986/1711) which provide for the management of stamp duty reserve tax imposed by Part IV of the Finance Act 1986 (“the 1986 Act”).

Under regulation 4 of the 1986 Regulations the “accountable person” is to give notice to the Commissioners of Inland Revenue of each charge to tax under the 1986 Act and pay the tax due. Under regulation 2 of those Regulations, if no member of The Stock Exchange is a party to a transaction in respect of which there is a charge to tax under section 87 of the 1986 Act, the accountable person is a “qualified dealer” as defined by that regulation.

These Regulations extend the definition of “qualified dealer” to include a European institution within the meaning of the Banking Coordination (Second Council Directive) Regulations 1992 (S.I. 1992/3218). The latter Regulations come into force on 1st January 1993 and give effect to the Second Council Directive 89/646/EEC on the coordination of laws, regulations and administrative provisions relating to the taking up and pursuit of the business of credit institutions (OJ No. L386, 30.12.89, p. 1). Under the terms of the Directive, credit institutions incorporated in a member state and certain of their subsidiaries may conduct a wide range of banking and other financial services throughout the Community. This necessitates the extension of the definition of qualified dealer in the 1986 Regulations to cover such institutions and subsidiaries conducting financial services in the United Kingdom.