Aged Material and for word Composite
LOAN CAPITAL. Mone)- raised by acompany upon debentures is called loan capital. It forms a debt due by the com-pany and is different from the actual capital,which is money subscribed by the membersof the company.By the Finance Act, 1899, Section 8 :—” (1) Where any local authority, corpora-tion, company, or body of personsformed or established in the UnitedKingdom propose to issue any loanDICTIONARY Of BANKING [LOAcapital, they shall, before the issuethereof, deliver to the Commis- isioners a statement of the amountprojiiiMcl to !). secured by the issue.(2) Subji’ I tM iIh> provisions of thisScLtioii <\.i\ Muh statement shallbe chcirged with an ad valoreinstamp duty of t\vo shilhngs and six-pence for every hundred pounds andany fraction of a hundred pounds ]over any multiple of a hundred ‘pounds of the amount proposed tobe secured by the issue, and theamount of the duty shall be a debtdue to Her Majesty.(3) The duty under this Section shall notbe charged to the extent to which itis shown to the satisfaction of theCominissioners that the stamp dutypayable in respect of a mortgage ormarketable security has been paidon any trust deed or other documentsecuring the loan capital proposed tobe issued.(4) If any local authority, corporation,company, or body of persons neglectto deliver a statement, or fail to paythe dutv in compliance with thisSection, that local authority, cor-poration, company-, or body of per-sons, shall be hable to pay to HerMajesty, in addition to the duty, asum equal to ten per cent, upon theamount of the duty, and a like sumfor c\cry month after the firstmonth durhig which the neglect orfailure continues.'(5) In this Section the expression ‘loancapital ‘means any debenturestock, county stock, corporation :stock, municipal stock, or fundeddebt, hy whatever name known, orany capital raised by any localauthority, corporation, company, orbody of persons formed or estab-lished in the United Kingdom, whichis borrowed, or has the characterof borrowed money, whether it is inthe form of stock or in any otherform, but does not include any countycouncil or municipal corporationbills repayable not later than twelve |months from their date or any over-draft at the bank or other loanraised for a merely temporary pur-pose for a period not exceedingtwelve months, and the expression’ local authority ‘includes anycounty council, municipal corpora-tion, district council, dock trustees,harbour trustees, or other local bodyby whatever name called.”By the Finance Act, 1907, Section 10 :—Reduction of Duty on Loan Capital issued forthe Purpose of the Conversion or Con-solidation of Existing Capital.’ (1) Where it is shown to the satis-faction of the Commissioners thatthe loan capital issued by any localauthority, corporation, company, orbody of persons, in respect of whicha statement has, after the com-mencement of this Act, been de-livered to the Commissioners underSection eightof the FinanceAct, 1899,has been wholly or partly appUed forthe purpose of the conversion orconsolidation of then existing loancapital, that authority, corporation,company, or body of persons, as thecase may be, shall be entitled torepayment in respect of the dutycharged on the statement so de-li%-ered at the rate of two shillings forevery hundred poimds of the capitalto which the statement relateswliich is so shown to have beenapphed for the purpose of the con-version or consolidation of thenexisting loan capital ; but thisSection shall not apply to any dutypayable in respect of a mortgage ormarketable security which has beenpaid on any trust deed or otherdocument securing the loan capitalwhich has been issued.” (2) If it is represented to the Commis-sioners by any such local authority,corporation, companv, or body ofpersons tliat loan capital about to beissued by them is to be appUed, inwhole or in part, for the purpose ofthe conversion or consohdation ofexisting loan capital, the Commis-sioners may postpone the time forthe dehvery of the statement and thepayment of duty under Section eightof the Finance Act, 1899, until thecapital has been issued or until suchother time as the Commissionersthink fit for the purpose of enabhngthe payment and repayment of theduty to take place as one transac-tion.” (See Coiip.^NiES, ShareCapital.)
