Taxes Management Act 1970

21 Stock jobbers’ transactions. U.K.

(1) The Board may exercise the powers conferred by this section as respects, and in connection with, any business which is, or has been, carried on by a [F1 market maker] F2 ... whose liability to tax in respect of the business is determined on the footing that any excess of his payments in respect of interest on securities over his receipts in respect thereof, being payments made or receipts accrued in pursuance of a contract for the sale or purchase of the securities, is to be treated for all the purposes of the Income Tax Acts or the Corporation Tax Acts as an annual payment made by him .

(2) With a view to obtaining information about transactions in the course of a business within subsection (1) above, the Board may serve on the [F1 market maker] F2 ... by whom the business is or has been carried on a notice requiring him to make available within a time specified in the notice, for inspection by an inspector or other officer of the Board, all such books, accounts and other documents in his possession or power as may be specified or described in the notice, being books, accounts or other documents which in the opinion of the Board contain or may contain information directly or indirectly relating to any such transactions.

(3) The Board may serve on any broker a notice requiring him to make available within a time specified in the notice, for inspection by an inspector or other officer of the Board, all such books, accounts or other documents in his possession or power as may be specified or described in the notice, being books, accounts or other documents which in the opinion of the Board contain or may contain information relating directly or indirectly to transactions in the course of a business within subsection (1) above.

(4) The Board may by notice in writing require—

(a) a person, other than a broker, who has directly or indirectly received from a [F3 market maker] F4 ... any payment made by the [F3 market maker] F4 ... in the course of a business within subsection (1) above, being a payment treated by the [F3 market maker] F4 ... as made in respect of interest on securities, to state within a time specified in the notice whether the amount received is in whole or in part received on behalf of, or for payment on to, any other person and, if so, to furnish the name and address of that other person, or

(b) a person who has directly or indirectly paid to a [F3 market maker] F4 ... any sum constituting a receipt by him in the course of a business within subsection (1) above, being a receipt treated by the [F3 market maker] F4 ... as accruing in respect of interest on securities, to state within a time specified in the notice whether the amount paid is in whole or in part received from, or paid on account of, any other person and, if so, to furnish the name and address of that other person.

(5) If, for the purpose of obtaining(from any persons whether brokers or [F3 market makers] or not) information directly or indirectly relating to any transactions in the course of a business within subsection (1) above, any person in whose name any securities are registered is so required by notice in writing by the Board, he shall state whether or not he is the beneficial owner of those securities, and, if not the beneficial owner of those securities or any of them, shall furnish the name and address of the person or persons on whose behalf the securities are registered in his name.

(6) The Board may not exercise their powers under the preceding provisions of this section for the purpose of obtaining information relating to transactions in any year of assessment ending more than six years before the service of the notice.

(7) In this section—

• [F3 “broker” in relation to securities, means a member of The Stock Exchange who carries on his business in the United Kingdom and is not a market maker in securities of the kind concerned;]

• F4 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

• [F5 “market maker”, in relation to securities, means a person who—

(a) holds himself out at all normal times in compliance with the rules of The Stock Exchange as willing to buy and sell securities of the kind concerned at a price specified by him, and

(b) is recognised as doing so by the Council of The Stock Exchange;]

• “securities” includes shares and stock, and references to interest include references to dividends.

Textual Amendments

F1 Finance Act 1986 s. 63, Sch. 18 para. 7 in relation to transactions effected on or after 27 October 1986.

F2 Words omitted repealed by Finance Act 1973 ss. 54, 59(7), Sch. 21 para. 5, Sch. 22 Pt. IV from 25 March 1973 except in relation to things done before that day.

F3 Finance Act 1986 s. 63, Sch. 18 para. 7 in relation to transactions effected on or after 27 October 1986.

F4 Words omitted repealed by Finance Act 1973 ss. 54, 59(7), Sch. 21 para. 5, Sch. 22 Pt. IV from 25 March 1973 except in relation to things done before that day.

F5 Finance Act 1986, s. 63, Sch. 18 para. 7 in relation to transactions effected on or after 27 October 1986.

Modifications etc. (not altering text)

C1 S. 21 applied (with modifications) (22.3.1992) by S.I. 1992/569, regs. 18, 22

C2 S. 21 applied (with modifications) (24.9.1992) by S.I. 1992/2074, regs. 9, 12

C3 S. 21 applied (with modifications) (1.10.1993) by S.I. 1993/2004, reg. 16

C4 S. 21 applied (with modifications) (25.8.1995) by The Income Tax (Manufactured Dividends) (Tradepoint) Regulations 1995 (S.I. 1995/2052), regs. 1, 13

C5 See Finance Act 1986 Sch. 18 para. 9(1)(b)—the Board may by regulations substitute s. 21(1) and amend other provisions of s. 21.