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FOUNTAINHEAD PROPERTY TRUST - Distribution : Tax treatment and salient dates

Release Date: 17/04/2015 07:07
Code(s): FPT
 
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Distribution : Tax treatment and salient dates

FOUNTAINHEAD PROPERTY TRUST
(A Collective Investment Scheme in property
registered in terms of the Collective Investment
Schemes Control Act No. 45 of 2002 and
managed by Fountainhead Property Trust Management Limited)
(Registration number 1983/003324/06)
JSE share code: FPT   ISIN: ZAE000097416
(Approved as a REIT by the JSE)
(“Fountainhead” or “the Trust”)


DISTRIBUTION: TAX TREATMENT AND SALIENT DATES


Unitholders are referred to Fountainhead’s unaudited interim results for the 6 months ended 28
February 2015, published on SENS on 17 April 2015, wherein unitholders were advised of distribution
no. 64 of 30.60000 cents per unit for the 6 months ended 28 February 2015 (“the distribution”), and
are advised as follows:

In accordance with Fountainhead’s status as a REIT, unitholders are advised that the distribution meets
the requirements of a “qualifying distribution” for the purposes of section 25BB of the Income Tax
Act, No. 58 of 1962 (“Income Tax Act”). The distribution on the units will be a dividend for South
African tax purposes, in terms of the Income Tax Act.

The distribution received by or accrued to South African tax residents must be included in the gross
income of such unitholders and will not be exempt from income tax (in terms of the exclusion to the
general dividend exemption, contained in paragraph (aa) of section 10(1)(k)(i) of the Income Tax Act)
because it is a dividend distributed by a REIT. This distribution is, however, exempt from dividend
withholding tax in the hands of South African tax resident unitholders, provided that the South African
resident unitholders provided the following forms to their Central Securities Depository Participant
(“CSDP”) or broker, as the case may be, in respect of uncertificated units, or Fountainhead, in respect
of certificated units:

   a) a declaration that the distribution is exempt from dividends tax; and

   b) a written undertaking to inform the CSDP, broker or Fountainhead, as the case may be, should
      the circumstances affecting the exemption change or the beneficial owner cease to be the
      beneficial owner,

   both in the form prescribed by the Commissioner for the South African Revenue Service.
   Unitholders are advised to contact their CSDP, broker or Fountainhead, as the case may be, to
   arrange for the abovementioned documents to be submitted prior to payment of the distribution, if
   such documents have not already been submitted.

Distributions received by non-resident unitholders will not be taxable as income and instead will be
treated as an ordinary dividend which is exempt from income tax in terms of the general dividend
exemption in section 10(1)(k)(i) of the Income Tax Act. It should be noted that up to 31 December
2013 distributions received by non-residents from a REIT were not subject to dividend withholding
tax. From 1 January 2014, any distribution received by a non-resident from a REIT will be subject to
dividend withholding tax at 15%, unless the rate is reduced in terms of any applicable agreement for
the avoidance of double taxation (“DTA”) between South Africa and the country of residence of the
unitholder. Assuming dividend withholding tax will be withheld at a rate of 15%, the net dividend
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amount due to non-resident unitholders is 26.01 cents per unit. A reduced dividend withholding rate in
terms of the applicable DTA, may only be relied on if the non-resident unitholder has provided the
following forms to their CSDP or broker, as the case may be, in respect of uncertificated units, or
Fountainhead, in respect of certificated units:

   a) a declaration that the distribution is subject to a reduced rate as a result of the application of a
      DTA; and

   b) a written undertaking to inform their CSDP, broker or Fountainhead, as the case may be,
      should the circumstances affecting the reduced rate change or the beneficial owner cease to be
      the beneficial owner,

   both in the form prescribed by the Commissioner for the South African Revenue Service. Non-
   resident unitholders are advised to contact their CSDP, broker or Fountainhead, as the case may be,
   to arrange for the abovementioned documents to be submitted prior to payment of the distribution
   if such documents have not already been submitted, if applicable.

The distribution is payable to Fountainhead unitholders in accordance with the timetable set out below:

                                                                                                 2015
Last date to trade cum distribution:                                                    Friday, 8 May
Commence trading ex distribution:                                                      Monday, 11 May
Record date:                                                                           Friday, 15 May
Payment date:                                                                          Monday, 18 May

Unit certificates may not be dematerialised or rematerialised between Monday, 11 May 2015 and
Friday, 15 May 2015, both days inclusive.

In respect of dematerialised unitholders, the distribution will be transferred to the CSDP
account/broker accounts on Monday, 18 May 2015. Certificated unitholders’ distribution payments
will be posted on or about Monday, 18 May 2015.

Units in issue at the date of declaration of the distribution: 1 162 709 748
Fountainhead’s income tax reference number: 3114/091/84/0P.

17 April 2015


Sponsor
Java Capital

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