Santander scrip dividends/rights issue/Income Tax

purdyoaten

Can't think of a good reason to revive a two year old thread?

zygurat789

purdyoaten wrote: »

Can't think of a good reason to revive a two year old thread?

Tax return season is looming and Santander has always caused a
headache. Foreign income divs or capital?

We should really applaud Gregoh for, at least, reading through the board, it's more than most do.

Spidernick

Many years ago a Rights Issue payment would just reduce the CGT base cost if under 5% of the total value, rather than a partial CGT calculation potentially needing to be done. Is it still the same these days (I haven't dealt with a Rights Issue in years)? No one seems to have mentioned this above.

caper7

I would like to thank Gregoh for reviving my original thread because I was about to myself!
Given the approaching tax return deadlines and Santander changing their default position on scrip dividends I have some further questions.
I find that for the tax year 13/14 all four dividends I received were scrip dividends, and if I have understood Santander's literature correctly neither the shares received nor the small amount of cash leftover are an income tax matter.
However I notice that 00ec25 originally said: "If you instead elect to buy the scrip shares you would still have to declare the value of the scrip "purchase" as a dividend received"
Would be grateful if anyone can clarify wether I need to mention these scrip dividends at all on my self assessment tax return.

Quite frankly I hate these flipping shares, I would sell them, but apparently that's a nightmare too

Spidernick

If you are getting shares in lieu of a dividend, and would otherwise have received the dividend, then the amount of that dividend should be declared in the same way the dividend would need to be (unless there's some rule I don't know about).

caper7

Well, this is what I noticed some people saying in other threads, yet it does seem at odds with what santander write in their booklet/website :

http://www.santander.com/csgs/Satellite?appID=santander.wc.CFWCSancomQP01&c=DocumentoGS&canal=CSCORP&cid=1278689394292&empr=CFWCSancomQP01&leng=en_GB&pagename=CFWCSancomQP01%2FDocumentoGS%2FDocumentoGSPreview

This is why I thought I would canvas some opinions.

Anyway, ended up calling HMRC, the man I spoke to said I shouldn't include them on the income tax return, this is for option 1 holding your rights and receiving shares.

I did ask how I would declare shares, did I need to figure out how much they were worth etc.... He said it was Santanders job to provide me with the necessary information to complete the return and that the paperwork I had didn't sound like a tax voucher.
Last year when I received cash instead of shares for scrip dividends, the paperwork said tax voucher and dividend statement, now it only says dividend statement, he felt this was fairly conclusive also...

molerat

caper7 wrote: »

..............
http://www.santander.com/csgs/Satellite?appID=santander.wc.CFWCSancomQP01&c=DocumentoGS&canal=CSCORP&cid=1278689394292&empr=CFWCSancomQP01&leng=en_GB&pagename=CFWCSancomQP01%2FDocumentoGS%2FDocumentoGSPreview

................

Says all 3 methods are treated as a capital distribution and thus only subject to CGT.

caper7

You're right Molerat. Well that confirms my current position, but I hadn't continued reading the options that no longer apply to me, but now it seems I shouldn't have included the scrip cash dividends last year!
Quite frankly, when even HMRC aren't that clear on what to do with these shares, because I'm pretty sure I would have called them about it at the time, I think it's ridiculous.
I actually started this thread originally to find out what to do with these scrip dividends, and still managed to get it wrong.
Am I really expected to now correct previous tax returns? As HMRC said today, we are talking about such trifling sums.
Quite upset now realising I got it wrong previously. :mad: