CGT: Tesco Shareholder Compensation
Posted: April 11th, 2018, 8:14 pm
Back in 2014 Tesco's board mislead the market, and certain shareholders who bought (or increased their holding) between the dodgy announcement, and the announcement of the truth were eligible to claim compensation. This amounted to 24.5p per share, plus interest.
The interest is straight forward income, however the CGT isn't.
For the record, the shares concerned were bought in one tranche, original cost £3045. The compensation was £318. (which exceeds the 5% definition of a "small capital distribution")
I still hold the original shares.
I think that there's three ways to handle this:
Is this treated as a partial disposal in 2017/18, or should I treat this as a "refund" on what I paid? (and adjust the acquisition cost for CGT purposes)
If I treat it as a partial disposal, then I don't know how to handle this - as far as I'm concerned the nature of the underlying asset (the tesco shares) hasn't changed.
Anyone else got any experience of this or comments?
PochiSoldi
The interest is straight forward income, however the CGT isn't.
For the record, the shares concerned were bought in one tranche, original cost £3045. The compensation was £318. (which exceeds the 5% definition of a "small capital distribution")
I still hold the original shares.
I think that there's three ways to handle this:
Is this treated as a partial disposal in 2017/18, or should I treat this as a "refund" on what I paid? (and adjust the acquisition cost for CGT purposes)
If I treat it as a partial disposal, then I don't know how to handle this - as far as I'm concerned the nature of the underlying asset (the tesco shares) hasn't changed.
Anyone else got any experience of this or comments?
PochiSoldi