5 year rule on Dividend Reinvestment Schemes

[attractioninvestor]

Hello All,

Another questions I can't seem to be able to find an answer to.

Shares purchased through Dividend Reinvestment Schemes, do they fall under the 5 year rule or not. Cant seem to find the answer online, but I remember on the fool site there was once a comment that they do not. Can anyone provide a source of information that I could refer to?

Thanks

JC

[scotia]

Hello All,

Another questions I can't seem to be able to find an answer to.

Shares purchased through Dividend Reinvestment Schemes, do they fall under the 5 year rule or not. Cant seem to find the answer online, but I remember on the fool site there was once a comment that they do not. Can anyone provide a source of information that I could refer to?

Thanks

JC

I believe that VCT DRIS investments need to be held for 5 years to obtain the tax relief.
However, if you are selling VCT shares which are past the 5 year hold, then a recent purchase of the same shares via a DRIS should not be affected by the 6 month rule . Kidman (26th May 2017) searched and found the relevant document in this case:-
viewtopic.php?f=25&t=2428&p=56179&hilit=Finance+Act+2014#p56179

[Mainwaring]

I agree with Scotia, except, Baronsmead used to reissue shares as a dividend under a DRIP. These didn’t have to be held 5 years as there was no accompanying income tax relief certificate. There may be others that used to DRIP like Baronsmead but I don’t think any current mainstream.