Jurisdiction(s):
United Kingdom

Related legal acts

Key definition

Securities definition

What does Securities mean? In legal practice, securities are tradable instruments that evidence ownership or debt, typically shares, bonds/debentures, and related instruments (for example, warrants), used in corporate finance and capital markets transactions. The term is used across multiple legal contexts and is often defined by statute. In the UK, under the Financial Services and Markets Act 2000 (Regulated Activities) Order 2001 (RAO), “securities” denotes a grouping of specified investments (for example, shares, debentures, government and public securities, warrants and certificates representing certain securities), distinct from “contractually based investments” and “other investments.” Separately, UK regulation and EU-derived frameworks use “transferable securities” (a MiFID/Prospectus...

UK VAT: Practical application of the dealing with securities exemption, covering derivatives, stock lending, LSE and ICE trading, electronic data services, and interaction with intermediary services

Published by a LexisNexis Tax expert

Practice notes

Why is the exemption for financial services important?

VAT is a significant issue for firms in the financial sector because supplies of certain financial services to customers who belong in the UK are exempt from UK VAT. This matters because:

businesses do not charge VAT on services that fall within the exemption; and
those businesses cannot recover input VAT on costs they incur when making an onward Exempt supply

Dealing with Securities exemption

The issue, transfer, receipt of, or any dealing with:

any security; or
secondary security

is exempt from VAT. Throughout this Practice Note, this is described as the 'dealing with securities exemption'. This Practice Note also looks at examples of how the dealing with securities exemption applies in practice. For detailed definitions and the conditions attaching to this exemption, see Practice Note: Exemption from VAT for dealing with securities and Underwriting. The supply of intermediary services connected with the above transactions, where a person acts in an intermediary capacity, is likewise exempt. For further information, see Practice Note: Exemption from VAT for intermediary financial services...

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Web page updated on 22/05/2026

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