The latest Investing Matters Podcast with Jean Roche, Co-Manager of Schroder UK Mid Cap Investment Trust has just been released. Listen here.
This share just does your head in. I set myself an out target after missing the days of 10, 11, 12p and cutting back my expectations some time back. Close of play today hit that revised target. So should sell right? But who in their right mind would sell with the possibility of an offer or dividend or whatever is up their sleeve.
Think I have got to hold, and hope that for once HUR doesn't let me down again.
Done
Corryvreckan1 thanks for the short version, makes sense Thanks.
I have HUR shares in an ISA so not fussed how the money comes, but have another HUR holding in a normal share account, where I would prefer Capital return over dividend, do I get 2 votes, as would probably go 2 different ways to split the odds.
Both are held with the same Company.
A tender would have to be offered to all. But not every shareholder has to, nor will necessarily want to accept an offer at that level and so the end result is a shifting of each shareholder’s relative 30% held after the event.
I thought it would be an all or nothing scenario, either everyone get the buy back or no one, so everyone % shareholding stays the same.
But I think CA would probably sign up to share buy back, as their 29% @8p is currently worth £44.6 million
if the advertised 3.1p is the buy back, you have got to think the share value would drop say 2p (if not the 3.1p) and then @ 6p their revised stock holding would be £33.46M having not received a penny.
Or have I got this all wrong.
But typical HUR board, no clear outline to their intent, so poor shareholders don't know what will be done, so can't plan their tax issues.
Corryvreckan1. I get where you are coming from, but a share is a share, what is offered to one must be offered to all.
Unless they were different class of shares, which I don't believe they are.
If CA were going to be paid 11p a share as calculated by Dyflnch then I would want some of that.
I think the buy back would be on all shares, so they would still have 29%.
Fangd £7750, less £1000 dividend allowance if not used elsewhere, therefore £6,750
Q1 23 correct, sorry was thinking tax years , being Q1 of tax year not actual year, I stand corrected thankyou.
That being said, you will have £2000 dividend allowance for 22-23 slightly different tax thresholds and 1.25% additional tax making it 8.5%, 33.75% and 39.35% tax. So just to make it a bit more difficult.
Assume 250,00 shares @ 8p = £20K. 3.1P dividend in 2023-24 tax year =£7,750
£1K Dividend allowance (If not used on other share Dividends)
Taxed on £6,750 assuming all of the tax is in one of the rates below and not spread across 2 rates.
Basic Rate Dividend tax 7.5% (Earning upto £37,700 20% rate) =£472.50 tax
Higher Rate Dividend Tax 32.5% (Earning over £37,700 40% Rate) = £2193.75 tax
Additional rate Dividend Tax 38.1 % Earning over £125,140 45% Rate = £2571.75 tax
If you are thinking of selling and fortunate enough to have profit, consider capital gains this tax year tax free allowance £12,300
Year 23-24 £6,000 Year 24-25 £3,000
The original RNS did say there may be more than one Dividend payment in 2023/2024, so tax liability may be more.
So a bit difficult to work out what to do, as we do not have a actual answer on what it will be. Will it be a takeover @ 7.7p or better (7.7p doesn't seem to be on the cards as they are applying for the Capital option) Will it be dividends, if so how much and when. So good luck everyone in working out what is best for you with your shares.
From a bit more reading in the right area this time, it would appear (from my understanding and I am not a tax advisor) Is that HUR are the entity looking at the Capital reduction, as shareholders if we receive an amount per share, without giving up any shares / capital / buyback, the payment received will be treated as a dividend and taxed as such. Unless of course you hold them in an ISA.
Hi, Hold fire on below, that statement came from an excerpt pertaining to owner managed companies.
Hi Littlened, was doing some reading on this and found the folllowing.
Tax treatment of dividends arising from share capital reduction
HMRC considers that dividends/distributions paid out of profits created in this way will be treated as a ‘normal’ income distribution for tax purposes. The amount effectively loses its identity as ‘capital’ and hence cannot be treated as a repayment of share capital (CTA 2010, s 1000(1)A) - see also HMRC’s Company Taxation manual at CTM15440.
With possible Dividend payout a possibility, wanted to get my holding into an ISA, so thought that's ok, will double my holding and sell off original, as modest profit on sale would be capital gains (but not above threshold) but dividend tax would be bad news tax wise. So from a selfish point of view want SP to stagnate around 7.0 to 7.5 for a bit. Hoping to buy and sell around the same value, but with all the turmoil HUR has dealt over the years, don't want it to have 1 last laugh at me.
Correct no tax on shares in an ISA. Apologise for not including that.
Was more clarifying that 8.75% was not an across the board rate, if tax is due on a dividend.
8.75% on basic tax
33.75% upper rate
39.35% additional rate
on dividend income over £2000
3 more E mails would be good, well done all.
Looks like Petroatlantic again moving into position for the off load.
Just trying to end the week on a positive.
Just sent mine. Apologise for delay, been away.
E Mail sent
2 weeks on from the AGM, depressed SP, has anyone seen any of the BOD investing?
I think the Q&A at the AGM could be interesting. Assuming the questions everybody wants to ask, get asked.
With shareholders quizzing the Board, you get the feel for what is going on and what they are like as individuals when you can see the whites of their eyes. Just gutted I couldn't be there today.
No worries, thought I was being helpful, but must go look for my sense of humour. :) :)