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A company has enquired whether promissory notes received as payment, which do not specify being either 'to order' or 'not to order', are subject to tax. The DGT has ruled that, as they do not include an exclusion clause, they are considered negotiable instruments subject to Stamp Duty.
Companies must ensure that promissory notes are correctly drafted to avoid unintended Stamp Duty liabilities, as the absence of a specific 'not to order' clause may classify them as taxable negotiable instruments.
The tax team reviews your specific situation.
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