Designation of the Bond Exchange of South Africa as a recognised stock exchange for tax purposes

With effect from 16 April 2008 HM Revenue & Customs (HMRC) have designated the Bond Exchange of South Africa (BESA) as a recognised stock exchange under section 1005 (1) (b) Income Tax Act 2007 as amended by Schedule 26 to the Finance Act 2007.

Products listed on the BESA will meet the HMRC interpretation of listed as set out in section 1005 (3) (a) and (3) (b) Income Tax Act 2007 as amended by Schedule 26 to the Finance Act 2007. However, please note that products traded Over the Counter (OTC) on BESA will not meet the HMRC definition of listed.

The list of overseas stock exchanges designated as recognised stock exchanges under section 1005 (1) (a) and (1) (b) Income Tax Act 2007 is available.

With effect from 16 April 2008 BESA will also be regarded as a recognised stock exchange for Inheritance Tax purposes.

Notes

The term recognised stock exchange' occurs throughout the Tax Acts and in various tax regulations. For example it is used in connection with close companies in section 415 (1) (b) Income and Corporation Taxes Act 1988, and in the definition of investments which may be held in Personal Equity Plans (PEPs) and Individual Saving Accounts (ISAs). The term is often used in the phrase listed on a recognised stock exchange.

The definition of a recognised stock exchange is given in section 1005 Income Tax Act 2007. It includes the London Stock Exchange and Plus-listed market and any such stock exchange outside the UK as is designated in an Order of the Commissioners of HMRC.

Recognition under section 1005 Income Tax Act 2007 is for tax purposes only and confers no other status on the exchange concerned: it does not constitute any form of recognition or approval for regulatory or other purposes nor does it provide any form of approval or recommendation of any of the investments which are listed or traded on that exchange.