PSI17.1.28 - Tax Treatment of Approved Schemes and Payments by Approved Schemes: Tax Treatment of Approved Schemes - Stock Lending

(This archived guidance relates to HMRC discretionary practice before the 6th April 2006. For current guidance on Registered Pension Schemes see the Registered Pension Schemes Manual)

[PN17.10]

A number of exempt approved schemes (generally large self-administered schemes) lend securities to jobbers on the Stock Exchange so that the jobbers can complete contracts within an account period laid down in the Stock Exchange rules. The jobber will transfer the borrowed securities into its client’s names and give the scheme a contractual right to similar replacement securities. Although the scheme no longer owns the securities that have been lent it remains entitled to receive dividends, interest or bonus issues on those securities. Additionally the jobber pays a fee or commission to the scheme for the use of the securities.

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