In the listed sector, shareholders may be presented with various
elections to be made as regards the nature of distributions made by
companies in which equity investments are held.
Shareholders can therefore be faced with an election to receive
payment of a cash dividend, or in lieu thereof, to receive
capitalisation shares from the underlying company or to partake in
a dividend reinvestment plan.
Shareholders should be aware that the South African tax
consequences of such distributions made by South African tax
resident companies may differ materially, depending on the election
made. A high level overview of certain tax aspects relating to
these distributions is set out below.
