Company: LLOBF
Filing Date: 2025-10-28
Form Type: 424B2
Source: 0000950103-25-013729
Chunk: 79

Company: Lloyds Banking Group plc
Filing Date: 2025-10-28
Form: 424B2
Chunk 79
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 Considerations—Material U.S. Federal Income Tax Considerations—Taxation of the Additional Tier 1 Securities—Constructive Distributions.”

Potential FATCA withholding.

Under certain provisions of the U.S. Internal Revenue
Code of 1986, as amended, and Treasury regulations promulgated thereunder (commonly referred to as “FATCA”), as well
as certain intergovernmental agreements between the United States and certain other countries (including the U.K.) together with local
country implementing legislation, a 30% withholding tax may be imposed on payments on the Additional Tier 1 Securities, Settlement Shares
and ADSs if those payments are (i) treated as “foreign passthru payments”, and (ii) made to a non-U.S. person that does not
comply with the due diligence, reporting and certification requirements under FATCA. The term “foreign passthru payments”
is not defined yet, and therefore it is not clear whether or to what extent payments on the Additional Tier 1 Securities, Settlement Shares
and ADSs could become subject to this withholding tax or how intergovernmental agreements will address foreign passthru payments. Under
proposed Treasury regulations (the preamble to which specifies that taxpayers may rely on them pending finalization), no FATCA withholding
will apply prior to two years after the date on which final regulations on this issue are published. If withholding is required in respect
of this withholding tax, LBG will not be required to pay any additional amounts with respect to any amounts withheld.

Limitation on gross-up obligation under the Additional Tier 1 Securities.

LBG’s obligation to pay additional amounts
in respect of any withholding or deduction for or on account of United Kingdom taxes under the terms of the Additional Tier 1 Securities
applies only to payments of interest under the Additional Tier 1 Securities and not to payments of principal, and only to the extent LBG
has sufficient Distributable Items and is not subject to other restrictions on distribution. As such, LBG would not be required to pay
any additional amounts under the terms of the Additional Tier 1 Securities to the extent any withholding or deduction applied to payments
of principal or to the extent it did not have sufficient Distributable Items or other restrictions on distribution were to apply. Accordingly,
if any such withholding or deduction were to apply to any payments of principal under the Additional Tier 1 Securities, or LBG did not
have sufficient Distributable Items, or other restrictions on distribution were to apply, owners may receive