Tax
Tax treatment of repo transactions differs according to jurisdiction. As a result, we advise all counterparties who want to enter in the repo business to consult with their accounting departments before doing so.
Tax treatment for repo and its variations vary significantly across different criteria. Typical issues that affect a customer's tax status and repo tax liability will include legal jurisdiction, type of underlying, trade booking domicile, type of bond borrow/lend pursued, ie, repo, buy/sell backs, securities lending etc. This topic is out of the scope of this guide as too many combinations exist and require an individual appraisal and consultation. We therefore advise all counterparties who want to enter the repo business to consult with their accounting departments before doing so.
