Income Tax Act 2007 section 987

Meaning of "quoted Eurobond"

Section 987 defines what a "quoted Eurobond" means for the purposes of Part 15 of the Income Tax Act 2007, which is important because interest paid on a quoted Eurobond is exempt from the requirement to deduct income tax at source.

• A quoted Eurobond is a security (including certain shares) issued by a company that is listed on a recognised stock exchange or traded on a qualifying multilateral trading facility and carries a right to interest
• The definition includes permanent interest bearing shares, such as those issued by building societies
• A qualifying multilateral trading facility must be operated by a recognised stock exchange regulated in the UK, the European Economic Area, or Gibraltar
• Because interest on quoted Eurobonds is paid gross (without tax deducted at source), the recipient remains responsible for declaring and paying any income tax due on that interest