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Post by congregatio on Dec 23, 2017 6:05:17 GMT 4
Stamp duty is payable on instruments evidencing a transfer of Hong Kong stock. Stock is broadly defined in the Stamp Duty Ordinance (SDO) to include debentures, loan stocks, bonds or notes issued by any corporate or incorporate body, any government or local government authority. However, the definition also contains many carve-outs and exemptions which effectively excludes an instrument that either:
Is neither denominated nor redeemable in Hong Kong dollars. Only bears reasonable commercial rate of return and is not convertible to stock.
Hong Kong stock is defined as stock the transfer of which is required to be registered in Hong Kong.
The transfer of most loans does not require registration in Hong Kong and therefore stamp duty is not an issue. However, where a Hong Kong dollar debt instrument is in registered form and provides for other than a reasonable commercial rate of interest, it can attract stamp duty on its transfer. Where stamp duty is payable, any transfer of the loans attracts a total stamp duty at 0.2% on the consideration or the market value of the shares (that is, 0.1% on the shares sold and another 0.1% on the shares bought). Subject to the terms in the agreement, all parties executing the instrument are liable to pay stamp duty. Hong Kong also levies stamp duty on bearer instruments. Debt instruments in bearer form can attract 3% duty. The liability is on the issuer.
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