The latest Investing Matters Podcast with Jean Roche, Co-Manager of Schroder UK Mid Cap Investment Trust has just been released. Listen here.
To make no impact on SAYE members is the only thing I can see.
Or perhaps they are colluding with this website to drive traffic here to discuss it every day constantly...other than that I don't see much other benefit.
Cheers - although i would think return of capital would be paid out of share capital and share premium account. From Vecturas statement of changes in equity for their return of capital it was out of retained earnings.
I feel like you're getting frustrated... I'm just interested in how it works. My small holding is in tesco is in an ISA anyways.
Was the asian business not sold at a profit of the net assets disposed of?
Very high level: The value of a company is assets - liabilities + an estimated value of future profits.
What happens when a company pays a dividend... cash decreases i.e the assets go down therefore your market cap goes down. the rest (share consolidation) is just noise. The market will decide what the market cap should be and adjust it very quickly.
Either way, invest 240k and 50k is coming back to you so not sure what your point is here?
I can't get my head round how a capital repayment would work. I assume the capital isn't coming out of retained earnings or its a normal dividend. So that leaves share account and share premium, which is less than 6bn in total, so no way they'd return 5bn through this.
Is there a tax accountant around?
Yes i personally didn't like the big sells from the one of the founders (albeit who doesnt work there anymore) and found the RNS updates ambiguous with many on here on this forum (who come across as intelligent investors) interpreting them differently. So i sold a large (not all) chunk of my holding, i always did have a little more invested here than i was comfortable with tbh.
The withholding tax on dividends also means you're not going to achieve the same P/E either when the dividend yield is so high.
Overall the lack of hedging has resulted in some periods the customer winning, some periods the customer losing, but over a long time its pretty much balanced out.
Overall PLUS has saved on hedging cost which make up a large chunk of Cost of sales for IGG and CMCX.
PLUS return a lot of the profits via dividend.
Its a trade off, they could hedge and pay c25% of revenue towards hedging, reduce the profit but increase the share price, or you can take the long term view that the high (sustainable) dividend yields will continue to flow at a suppressed share price, while they continue buying back shares cheaply.
I doubt you are comparing quite what you think you are comparing, the price of a share of one company vs the price of a share of another company isn't overly comparable. Although their relative movement is which is what you are implying.
Sainsburys has net assets of 7.8bn, it has a market cap of of 5.5bn. if it sold all all its assets and settled all its liabilities then in theory share holders would be better off than they are now.
whereas tescos net assets is 13bn (half of which are intangible), & has a market cap of 24bn.
Looking at this alone implies sainsburys is undervalued vs tesco.
Although tesco has a much better p/e ratio
(analysis only done on full year accounts which are coming up to a year old for both companies)
Regardless of whether you consider investing gambling.
Jaff asked - profits from gambling are tax free?
Answer - for you as an individual yes, if you win big on the horses through William hill or any bookie yes, if you win the national lotto* yes.
However - for William hill and any other bookie they not only pay corporation tax they also pay a gambling levy which is an additional tax on profits between 15-50% depending on the type of gaming. So HMRC still get their share. If the HMRC didnt do this then you would be able to win more because the likes of william hill would not need to absorb this cost so could decrease the spreads on the bets.
In summary - gambling is taxed but you dont notice it, its effectively taxed as source like your pay slip. if it wasn't taxed then you would be able to win £1.15m on the lotto for 5 numbers plus the bonus rather than £1m
*(Although I believe if you win on one of those scratch cards that pay 10k for life or anything for life that actually is classes as income because its a recurring payment)
Tesco made the sale not you. Tesco will treat it as a business disposal for tax purposes. You are an investor. You should treat it as dividend income as that is what it is. Do what ever you fancy on your tax return. Good luck if you get caught, but I'd take advice, sounds like tax evasion to me. If you haven't made use of Isa wrappers then do so. If you have, well you are probably sufficiently wealthy, probably not worth the risk of engaging in tax evasion.
Found something on it, but cba to read it all. I'm sure options were explored with regards to how to return the cash.
The fact that it's not usual way to return cash probably means it's either on risky ground in terms of tax evasion.
While they are tax free a gambling levy is applied which is paid by the gambling company, but ultimately the customer pays of course.
Taxes have to be raised from somewhere, capital gains tax is levied on the wealthy (relatively few will exceed the capital gains tax free amount)
Hi Ghost - agree with your points on the whole... but a couple of corrections/comments.
CMC year end is March 31st.
I don't see any mention of growth into 2021 (unless you are looking outside the RNS?), the full year company compiled consensus, is for FY 2021, i.e year ending 31/3/2021. Historically whenever they revise consensus they have tended to assume that revenue reverts to normal levels immediately, which has never been realistic in the the last year.
Sorry- i missed you had said £1.51.
Yes i doubt it matters, if they are consolidating the shares to keep the price per share the same it makes little difference i suspect. Either way, if you sell them straight away a nice tidy profit.
As a side note SAYE schemes are slightly dangerous imo, they encourage "risky" behaviour. Many people keep the SAYE shares once they mature but yet would not put £1 of their cash out of their bank account into the stock market.
For some reason once you have the shares they psychologically much harder to sell.