Income Tax Act 2007 section 674

Meaning of "the settlement day"

Section 674 defines how the "settlement day" is determined for transfers of securities, depending on whether the transfer takes place on a recognised market or outside one.

• For transfers on a recognised market, the settlement day is the day the buyer agrees to settle, or if there is a choice of days, the day settlement actually occurs.
• For off-market transfers where the consideration is money only and is due by the first interest payment day after the agreement, the settlement day is the agreed payment date (or the latest date if there is a range).
• Where there is no consideration, or the transfer arises from specific deemed-transfer provisions (such as conversions, strip exchanges, trading stock appropriations, trustee entitlements, or securities leaving charitable trusts), the settlement day is simply the day the securities are transferred.
• If none of these rules apply, an officer of HMRC determines the settlement day, and that decision can be appealed to the tribunal.