»Ê¹ÚÌåÓýapp

»Ê¹ÚÌåÓýapp Gateway Conditions

ITA07/S888A(2) defines a qualifying private placement as a security which:

• represents a debtor loan relationship of a company;
• is not listed on a recognised stock exchange; and
• meets other conditions specified in regulations.

»Ê¹ÚÌåÓýapp term ‘securityâ€� is not specifically defined in ITA07/S888A and can encompass a wide range of debt instruments that are capable of being transferable investments. It does not require that a lender has rights over assets put up as security for the debt, although this will often be the case.

Nor does the term ‘securityâ€� require that the instrument is in a particular form. »Ê¹ÚÌåÓýapp private placement market increasingly makes use of standardised documentation. »Ê¹ÚÌåÓýappse standard templates may be in the form of notes issued by a borrower, or in the form of a loan. Loan-like agreements are not precluded from the exemption by the use of the term ‘securityâ€� in the gateway condition. »Ê¹ÚÌåÓýapp use of different types of instrument is often determined by the differing requirements of lenders in particular territories.

»Ê¹ÚÌåÓýapp Qualifying Private Placements Regulations 2015 apply to ‘relevant securitiesâ€�. See SAIM9330 for more on this.

»Ê¹ÚÌåÓýapp private placement must represent a debtor loan relationship of a company. A private placement may be in the form of a loan to a UK company from a non UK-resident intermediary that issues notes to investors, with the payments on the notes secured on the loan to the UK borrowing company or guaranteed by it. Provided the other conditions set out in regulations are met (SAIM9330 onwards), the borrowing company can benefit from the exemption from the duty to deduct income tax from the interest paid to the intermediary.