Homeco Daily Needs REIT (HDN) has acquired Aventus (AVN) in a Scheme of Arrangement. How does Sharesight handle the treatment of this deal? Is it a simple sale and purchase (with the corresponding tax implications)? Or is there a correct way of inputting the trades into Sharesight?
I have seen the page about Mergers. Very useful.
However, do I need to confirm all the distributions earned on the Aventus holdings prior to merging the holdings, or will I have the option to do this after merging the holdings. I ask, as the AMIT statements have not yet been released for Aventus, so I cannot confirm any distributions until after that statement is released.
Great to hear! The distributions will show on the taxable income report whether or not they’ll be confirmed. Just on the AMIT components & taxable income report, if payments are confirmed the components (not the net value) still adjust when updating the components in the report
Hello @Jack_Sharesight, I have another question related to this query.
This particular merger has a cash component, but there doesn’t seem to be an option to account for cash consideration? Can you advise?
So for cash, typically for mergers would enter a manual return of capital trade for the cash component.
From what I gather from the Scheme booklet tax information, it’s actually going to be a bit more complex. The AVN securities were destapled into AHL shares and ARPF units and the cost base of the AVN holdings need to be split into these. The cash component represents the sale of the AHL shares which is taxed as a CGT event and the cost base assigned to the ARPF units rolls over to the new HDN holdings.