ACCA Strategic Professional · Advanced Taxation (UK) · Taxes applicable to a given situation or course of action and their impact
Dev is a director who plans to buy shares in a UK company for £80,000 through a stock transfer. Using the rate in the examinable tax tables, what is the stamp duty payable by the purchaser?
The stamp duty is £400. Stamp duty on the purchase of shares is charged at 0.5% of the consideration, so 0.5% of £80,000 gives £400. Using a higher percentage, such as the land tax rate, would overstate the cost.
- A£400Correct
- B£4,000
- C£800
- D£0
Explanation
Stamp duty on shares is 0.5% of the consideration. 0.5% of £80,000 is £400. £4,000 results from using 5%, and £800 from using 1%.
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