Debt vs Equity

Hybrid equity instrument

X is an issuer of a share (which is not an equity share) and
-X is obliged to redeem that share in whole or part; or the share is redeemable at the option of
Y who is the holder or
-Within a period of 3 years from the date of issue
Therefore the share is a hybrid equity instrument
X is an issuer of a share and
-X is obliged to redeem that share in whole or part; or the share is redeemable at the option of
Y who is the holder; or
-Within a period of 3 years from the date of issue
Therefore the share is a hybrid equity instrument
Company Y is the issuer of a share and on the date of issue, the existence of the company
-Is to be terminated within a period of 3 years or is likely to be terminated within a period of 3
years
Therefore the share is a hybrid equity instrument
Therefore any dividend or foreign dividend in respect of a hybrid equity instrument held by X shall be
deemed to be income.
Hybrid debt instrument
X is an issuer of an instrument and
-The instrument is at the option of X convertible into shares of X within a period of 3 years
from the date of issue
Therefore the item is a hybrid debt instrument
X is an issuer of an instrument and
-X is entitled to repay the instrument in whole or part by issue of shares of X within a period
of 3 years from the date of issue
Therefore the item is a hybrid debt instrument
X is an issuer of an instrument and
-X is entitled to repay the instrument in whole or part X within a period of 3 years from the
date of issue and is entitle at the time of repayment to require the holder(Y) to acquire share
of X
Therefore the item is a hybrid debt instrument
X is an issuer of an instrument and
- The instrument is at the option of the holder(Y) convertible into shares of X within a period
of 3 years from the date of issue and on the date of conversion the value of is likely to exceed
the value of instrument by 20%
Therefore the item is a hybrid debt instrument
No deduction is allowed in respect of amount payable by issuer of hybrid debt instrument