Beppa is not a traditional security, it is a hybrid security....

Beppa is not a traditional security, it is a hybrid security. Depending on what a comapny is trying to achieve, a hybrid can be either debt or equity. A really good discussion of hybrids is here:

http://www.claytonutz.com/downloads/PGrau.pdf

As it is not a traditional security, it is subject to the CGT provisions as long as the investment is held on capital account. For Beppa purposes, it is a debt hybrid, hence the income earnt is is the form of interest. Good place for the taxing overview is the 2008 Beppa tax guide found here:

http://bbinfrastructure.com/media/373883/2008_beppa_tax_guide_final.pdf

Cheers