UK Tax Treatment of Depositary Receipts: HMRC Will Still Treat ADR Holders as Beneficial Owners of Shares

Sullivan & Cromwell LLP - May 21, 2012

HM Revenue and Customs lost the HSBC case on stamp duty reserve tax in February, but did succeed in arguing that the American Depositary Receipts concerned did not give their holders beneficial ownership of HSBC shares.

HMRC has revised its capital gains tax guidance on ADRs following the case, but will still treat ADRs as giving their holders beneficial ownership of the underlying shares.