Member Info for MikeM14

Nigel,
This is the thing about averaging the cost of the shares in one company if you bought them in different tranches at different prices:-
https://www.gov.uk/tax-sell-shares/same-company
Of course, when you work out the buying cost, make sure you include the broker fee (if any), Stamp Duty (usually 0.5% added to the price of the shares), etc. And similarly, make sure the proceeds stated have the broker fee deducted. (So if you sell 100 shares at £2-40 and the broker fee is £9, the "proceeds" figure to use is £231).
Mike.

Nigel,
This should be a start:-
https://www.gov.uk/capital-gains-tax/losses
This is arguably going a bit "off topic" for a Tesco board, but relevant if for example people are baling out from Tesco shares at a loss.
Unless they've changed it again, how it worked when I last did a capital loss was you pool all your holdings of the same type of share (eg Tesco) into a pool of shares called a "Section 104 holding", and they're all treated as having the same average buying price regardless of whether you bought them in different tranches at different dates at different prices. This system came in in about 2008. Before that, it worked on a "first in, first out" (or maybe it was "first in, last out"?) basis.
If I find anything else, I'll post it.
Mike.

Nige,
I'll look on the HMRC website and post a link - if this LSE site allows me to do that. Unfortunately my broker didn't provide anything to me to certify any losses I made on share sales - I had to provide my own spreadsheets to HMRC, but they seemed to be happy with what I sent them. Certainly though it's worth waiting until April to see if your broker does provide you with a statement or something.
Mike.

Hi again Nige,
Re loss on Lloyds shares, unfortunately you can't offset such a loss against dividend income. You can only use it against capital gains elsewhere, and probably only against *the same kind of* capital gains (so gains on share sales, but not, for example, gains on a house sale). It's important to "register" the loss with HMRC as soon as practicable, and I think you can do this whether or not you're doing self-assessment. You can't, to my knowledge, get an immediate refund in the form of cash back, so it's a bit like a credit note.
Once you've registered the loss, and which year it occurred in, you can keep carrying it forward several years (I don't know off hand how many), which is great if you make big gains on shares in the future (but this is getting less and less likely by the way things are going!).
Cheers,
Mike.

Thanks Longtime investor.
I agree with everything you say in this and subsequent posts (I'm still going through all the recent ones!) about capital returns that should *not* be treated as income.
Re Vodafone, not to get off topic on this TSCO board but if it's the same one as mine, it was a big one when they sold off Verizon (or part of Verizon JV). From memory, without going back to my old notes at the time, they did that with "A" shares, "B" shares etc, but I may be thinking of something else.
Rgds,
Mike.

Thanks Nige, I'm glad it was of some help.
We all now await Monday morning with bated breath (and hope it doesn't prove us *all* wrong!), and look forward to receiving the dividend on the 26th (hopefully).
I'm going to "wind my neck in" now and sign off.
All the best,
Mike.

Thanks ECRyder, I appreciate that, but that's why I used the word "if". Having read many of the comments on here and seen the various confusion, this was just my attempt to break the whole thing into easy-to-understand stages to make things simple to understand. In reality, in this case, there is no "ex-dividend but pre-consolidation" stage. If my posting has caused more confusion, that's the exact opposite of its intention and I'm sorry for that.
Regards,
Mike.

ECRyder,
Regarding tax, I'll wait and see what my end-of-year consolidated tax certificate from my broker looks like. If they include this dividend along with all the other dividends from my other shares, I'll just have to go along with it and declare it as dividend income on my self-assessment return. If they don't include it, or annotate it differently, I'll deal with it appropriately.
I have had a situation before - I forget exactly which company - where capital was returned by the firm making a "tender offer" for 1 in 5 of every shareholder's shares, and in that case it was absolutely clear that it was a return of capital and *not* a dividend. That was about 15 years ago, so maybe things have changed since then.
Regards, Mike.

Sorry ECRyder, I don't understand what you're saying. My "Pre-dividend" figure is the situation "now", and the £2-40 is meant to represent the share price now (as an approximation). Maybe I'm being thick?
Rgds, Mike.

Sorry Nige(7),
Our replies "crossed" in the electronic post!
Generally, it appears to have been designed to be "neutral", ie neither benefit nor disadvantage, but the outcome for each individual shareholder will depend on his/her individual circumstances. In my own case, for example, I will now have to pay some income tax on some of the dividend - luckily only 7.5%. For higher-rate taxpayers, they may have to pay 32.5% on some or all of their dividend (all depending on where I/they sit in relation to this year's £2,000 nil-rate allowance for dividends. So being taxed to stand still!
*But*, as some have said, this is supposedly a "return of capital" rather than a "normal" dividend so there may be ways round that problem. Everyone's circumstances will be different.
Rgds, Mike.

Purely mechanistically, and using "round" numbers to make it clear, and starting with 19 shares to avoid fractions.
Pre-dividend:-
Shareholder has 19 shares currently priced @ £2-40.
Ex-Dividend (if there were no consolidation):-
Shareholder has 19 shares priced @ £1-89 plus £9-67 cash.
Post-Consolidation:-
Shareholder has 15 shares priced @ c £2-40 plus £9-67 cash.
Then "market" factors take effect...
Or is this over-simplistic?
Mike.

Nige7,
It's gone into a large cash dividend into shareholders' pockets (unless reinvested via DRIP etc).
Mike.

Axe-Capital,
Because they're paying out 50.93p Special Dividend on about 9.793 billion shares - that's about £5 billion cash being paid out from the company. Does that answer the question?
Mike.

Hi jimjam, et al,
As a holder of Tesco shares myself I very much hope that you're right and that early next week the price of the ("new") Tesco shares is about £3-13, but sadly I think that will *not* be the case, and, everything else being equal, the price of the new shares will be very similar to the current price of the existing shares. My own reading of Tesco's literature and announcements is that the whole exercise has been designed to result in the "before" and the "after" share price being about the same. However, because the dividend value (per share) is fixed whereas the share price itself moves in the market, the "before" and the "after" share prices can only be the same with one value of starting share price, and I think that is £2-42.
I have put together a complicated spreadsheet that works out what the "after" price would have to be for any given "before" price for the individual not to lose out, and the results are interesting. At £2-42, the "before" and the "after" price are the same, but the higher the "starting" share price, the higher still the "after" price would have to be so that one didn't lose out. I will re-check my formulae in the morning (I'm very tired now!) but the results for the "before" and the "after" price to maintain the same total value (including the special dividend) are, for now, as follows ("before" is on the left, and the necessary "after" is on the right):-
£2-20 / £2-14;
£2-30 / £2-27;
£2-35 / £2-33;
£2-40 / £2-39;
£2-42 / £2-42;
£2-45 / £2-46;
£2-50 / £2-52;
£2-55 / £2-58;
£2-60 / £2-65;
£2-70 / £2-77;
£2-80 / £2-90.
Of course the Tesco share price doesn't operate in a vacuum, and a lot could happen between now and next week!
Good luck all.
Mike.

Hi MinTid,
Sorry to reply late, and sorry also for complicating things further.
The BP dividend is announced every quarter, and it is announced in US Dollars (eg 5.25 cents). They then announce how much it will be in Sterling (£ and pence) nearer the time it's actually paid, depending on the £-to-dollar exchange rate at the time. So it won't be exactly 4p, and it won't be exactly the same number of pence every quarter - each one will be slightly different. Normally it won't vary very much, but for example if the £ "crashes", as it did with the Brexit vote in 2016, then it will vary much more.
As others have answered, what version of the share price you use to calculate the "yield" depends on what purpose you want to use the yield for. The newspapers used to have tables of yields for all the main shares (they probably don't anymore, but similar tables will exist on the internet), and these should use the most-recent share price. Whilst, everything else being equal, one might think that the higher the % yield, the better, if you see a *very* high yield (say 9%, or even 12%), I'd urge extreme caution. To be sustainable a company should not pay out any more dividend than it can safely afford, based on its trading performance, etc. A very high yield usually suggests that the market knows that the company is in trouble. A 12% yield isn't much use to you if the shares themselves then halve in value!
I hope that helps,
Mike.

Absolutely no problem Rocket57 - I'm glad it was appreciated. All the best with whatever you decide to do regarding BP (or anything else). Half of me says top-up my holding at these levels, but I'm just going to have to sit it out because all my available cash has gone elsewhere for now.
Mike.

Rocket57,
Forgive me if I'm stating the obvious, or misreading the nuance in your original post, or if you've already got your answer from someone else, but when dividends are announced, they are set as a fixed amount of money per share, not as a percentage of the share price. Also with BP they're set in US dollars at the time of the dividend announcement (so the one due for payment in March has, from memory, been announced at 5.25 cents (0.0525 US dollars) per share. That figure will, for UK shareholders, be converted to a Sterling (£ per share) figure at a time nearer the actual payment date dependant on the exchange rate at the time. So at the moment, as others have said, the March payment should be roughly £0-04 per share, but even if it's 5.25 cents every quarter, the exact amount each UK shareholder gets will probably be slightly different in each of the 4 quarters (because the £-to-dollar exchange rate is changing all the time). Also, the dividend for March is for the 4th quarter. The June, September and December payments might be different, even in the dollar figures announced, depending on the Board's dividend policy in the new financial year.
I hope that helps,
Mike.

Equilibrium,
It looks like you've answered your own questions!

Cereus,
The £4-68 would have been back around 2010 (I started buying-in in 2011 when it was in the £3's). I'm not sure how relevant that price is to today's situation, as it was *before* the accounting scandal broke (just before "Drastic Dave" came in, in about 2014), and it was before 10 years' worth of the "onwards and upwards" march of the German discounters, eroding Tesco's UK market share, etc.
Mike.

Cityjambo,
As I described in my own postings a couple of days ago, I find myself in a similar predicament, although at a somewhat smaller scale - my holding of Tesco is significantly smaller than yours. Like your situation, most of my holding was bought in tranches in 2011/2012/2013 at an average of nearly £4, so if I sold now or in the foreseeable future I'd make a capital loss. However, the original buying is now, of course, history.
The special dividend for me will bring a tax charge - how it affects others will of course depend on where they stand wrt the £2,000 nil-rate threshold for this year (assuming they haven't got their shares in an ISA, etc). Also, most will lose a fraction of a share through the consolidation - unless you round-up (or down!) your present holding of the current shares to a multiple of 19.
Whilst you will, indeed, end up with less shares, they're not the same shares as you have now. They are "bigger" - each one represents a bigger fraction of the total company (so hopefully each one entitles you to a bigger share of the company's total profits/dividends).
You mention disposing of shares. As I see it you're *not* disposing of shares (unless you choose to sell), they're being in effect exchanged for "different" shares.
That's how I see it, but maybe I'm wrong!
ATB, Mike.