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Giving rise to Spanish witholding tax on dividends?
That's correct.
Vote against this proposal. Can't help feeling that this is somewhat of a shafting to loyal UK shareholders here.
Will be 19% witholding tax (but can be reduced to 10% if you claim back 9% - however this will entail arduous and expensive reclaiming from the Spanish Tax authorities).
The worst thing is, anyone holding in an ISA will not be able to get double taxation relief on the withholding tax.
Vote against!
Or indeed if the shares are held in a SIPP.
I have asked a pertinent question of the management at Thursday's presentation
Needs to be a proper prospectus to explain the pros and cons of re-dom from Cyprus to Spain, otherwise I'll be voting "No" too.
Seems only positive is that ATYM will be eligible for "FTSE UK Index Series". However there are major tax impacts which will negatively impact Net Profit, net cashflow and therefore dividends available to shareholders (WHT on dividends, Corp Tax increasing from 12.5% to 25%). I know Corp tax is more nuanced than a simple 12.5% v 25%, hence why prospectus would be needed to change my mind.
I can see the problem rhere but im sure they will have considered carefully. The eliz and solar are also clearly timed to coincide in timing. Interestingly they say eliz will produce copper which they didnt say before
Alberto is projecting a $15,000 copper price...
The CFO is projecting a MCap of £700m...enough to take us into FTSE350...that equates to a SP of c£5!!!!
They've covered my concerns so I will vote for the re-dom. On corp taxes, there is no real impact. From webinar it is my understanding profits seen to be arising from Spain are subject to Spainish Corp Tax anyway.
On WHT, I hold my shares in normal stock account, so like other shares I own outside of ISA or SIPP wrappers which are subject to WHT, I declare it on my UK tax return and effectively recover the amount by reducing my UK tax accordingly (e.g. no double taxation), so no issues. That doesn't of course help those who hold their shares in ISA, SIPP or don't submit a UK Tax Return / return in another jurisdiction. If you are EU resident, WHT doesn't apply, but I bet if you hold your shares through a UK based shares brokerage may be bit bureaucratic to ensure WHT is not applied.
Following todays call, it becomes clear that all who hold Atalaya through SIPP or ISA (most individual UK holders) will be subjected to non recoverable WHT of 19% on dividends as a result of re-domiciliation to Spain. I for one will be voting against the proposal. Not happy with management's response of ignoring the issue.
As a ceo probably over optomistic. As a cfo probanly under optmistic. So somewhere between the 2 correct
Urzz - I understand and share your frustration with regard to the WHT for ISA/SIPP holders but maybe a better way forward is to raise the question directly to the company and ask them to look into it.?
Exactly what I did after the presentation today. I hope lots of people raise it directly with them too.
I have contacted the company. The CFO did seem to recognise the point but kept quiet. I'll also contact the PR people tmw as this seemed to help when the similar issue came came up for Cypriot WHT.
Good mention on kitco today about q3 results
A copy of the email I sent to 4Ccommunications:
Dear Carina
A consequence of the proposal above is that withholding tax (WHT) of 19% will be deducted from dividends paid by Atalaya. This withholding tax is NOT reclaimable by UK residents if they hold their shares in a SIPP or ISA. It is understood from past correspondance that this applies to the majority of individual UK holders of Atalaya. As a consequence the proposal will lead to the value of future dividends being reduced by 19% at a stroke which clearly is very significant.
It is apparent from the presentation yesterday that no thought has been given to this impact by management. I gather there were a number of questions on the issue. This is particularly of concern that when a similar issue arose with the Cypriot equivalent WHT management were able to persuade the Cypriot authorities not to deduct WHT I think on the grounds that most individual shareholders held the stock through SIPPs or ISAs. Atalaya now take a backward step in this respect.
I expect the proposal will be approved, as corporate holders, the majority, do not suffer this impact. A number of individual holders will consequently vote with their feet.
I urge management to consider what can be done. Are there ways to alleviate the impact: for example through negotiation with the Spanish tax authorities or are their exemptions in place for payments to UK Pension Funds?
I would be grateful if you would take this matter up with management.
Urzz well done mate I think/hope we shall see a nice reply/reaction from the BOD following your email which I think was very well presented and knowing how well the BOD is/has been performing overall hopefully it's going to be positive. All the best wishes. and GLA