What is the justification for stamp duty (SDRT) on non-tax accounts? Could more be added?

newlease · 1 December 2018 at 3:45PM

When buying shares in non-taxed accounts such as my ISA SDRT is still levied just as in a taxed account. What is the justification behind this? Is "stamp duty" not classified as a tax? From what I gather SDRT goes straight to HMRC coffers similar to CGT on taxed accounts and is not part of an oversight/control mechanism such as PTM levy or discouraging frequent or speculative trading.

What is the likelihood that more such "payable to HMRC but not tax" could be introduced?

agrinnall · 1 December 2018 at 4:18PM

The gov.uk explanation of ISAs is quite specific:

You do not pay tax on:

interest on cash in an ISA
income or capital gains from investments in an ISA

If you complete a tax return, you do not need to declare any ISA interest, income or capital gains on it.

https://www.gov.uk/individual-savings-accounts/how-isas-work

Any other sort of tax not mentioned is payable. I would guess that if you look hard enough there will be legislation to back up this position.

newlease · 8 December 2018 at 8:31PM

It is confusing because SIPP as well as ISA are referred to as tax free wrappers suggesting SDRT which is charged is not classified as tax. So they are only exempt from certain taxes namely capital gains and dividend or cash interest and so the answer to my question is yes further taxes such as SDRT could always be added as a loophole in the future.

What is the justification for stamp duty (SDRT) on non-tax accounts? Could more be added?

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