Section 889 — Income Tax Act 2007: Payments in respect of building society securities

Payments in respect of building society securities 889 1 This section applies to any payment made in a tax year if—

a it is a payment of a dividend or interest in respect of a security issued by a building society, and b conditions A and B are met in relation to the security.

2 Condition A is that the security was listed or capable of being listed on a recognised stock exchange at the time the dividend or interest became payable.

3 Condition B is that the security is not—

a a qualifying certificate of deposit (see section 985),

b a qualifying uncertificated eligible debt security unit (see section 986), or c a quoted Eurobond (see section 987).

4 The person by or through whom the payment is made must, on making it, deduct from it a sum representing income tax on it at the savings basic rate in force for the tax year.

5 For provision about the collection of income tax in respect of a payment from which a sum must be deducted under this section—

a see Chapter 15 if the person making the payment is a UK resident company, and b otherwise see Chapter 16.

6 See also Chapter 11 (payments between companies) for an exception from the duty to deduct sums representing income tax under this section.

7 In this section— “ dividend ” includes any distribution (whether or not described as a dividend), and “ security ” includes a share (and, in particular, a permanent interest bearing share as defined in section 117 of TCGA 1992).