FORTRESS REIT LIMITED - Dividend: Tax Treatment and Salient Dates

Release Date: 21/08/2018 17:39
 
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Dividend: Tax Treatment and Salient Dates

FORTRESS REIT LIMITED
(previously Fortress Income Fund Limited)
(Incorporated in the Republic of South Africa)
(Registration number 2009/016487/06)
JSE share codes:   FFA   ISIN: ZAE000248498
                   FFB   ISIN: ZAE000248506
Bond company code: FORI
(Approved as a REIT by the JSE)
("Fortress" or "the company")


DIVIDEND: TAX TREATMENT AND SALIENT DATES


Shareholders are referred to Fortress' preliminary audited summarised financial statements for the year ended
30 June 2018, published on SENS on 21 August 2018, wherein shareholders were advised of gross dividends of
70.57000 cents per A share and 88.93000 cents per B share for the six months ended 30 June 2018 ("the
dividends").

In accordance with Fortress’ status as a REIT, shareholders are advised that the dividends 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 dividends on the shares will be deemed to be dividends, for South African tax purposes, in terms of
section 25BB of the Income Tax Act.

The dividends received by or accrued to South African tax residents must be included in the gross income of such
shareholders 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 they are dividends distributed by a
REIT. The dividends are, however, exempt from dividend withholding tax in the hands of South African tax resident
shareholders, provided that such shareholders provide the following forms to their Central Securities Depository
Participant ("CSDP") or broker, as the case may be, in respect of uncertificated shares, or the company, in respect of
certificated shares:

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

      b)    a written undertaking to inform the CSDP, broker or the company, 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. Shareholders are advised to
contact their CSDP, broker or the company, as the case may be, to arrange for the abovementioned documents to be
submitted prior to payment of the dividend, if such documents have not already been submitted.

Dividends received by non-resident shareholders 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. Any distribution received by a non-resident from a REIT will be subject to dividend
withholding tax at 20%, 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 shareholder. Assuming dividend
withholding tax will be withheld at a rate of 20%, the net dividend amount due to non-resident shareholders is
56.45600 cents per A share and 71.14400 cents per B share. A reduced dividend withholding rate in terms of the
applicable DTA may only be relied on if the non-resident shareholder has provided the following forms to their
CSDP or broker, as the case may be, in respect of uncertificated shares, or the company, in respect of certificated
shares:

      a)    a declaration that the dividend 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 the company, 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 shareholders
are advised to contact their CSDP, broker or the company, as the case may be, to arrange for the abovementioned
documents to be submitted prior to payment of the dividend if such documents have not already been submitted, if
applicable.

The dividends are payable to Fortress shareholders in accordance with the timetable set out below:
                                                                                                            2018
 Last date to trade cum dividend:                                                          Tuesday, 18 September
 Shares trade ex dividend:                                                               Wednesday, 19 September
 Record date:                                                                               Friday, 21 September
 Payment date:                                                                             Tuesday, 25 September

Share certificates may not be dematerialised or rematerialised between Wednesday, 19 September 2018 and Friday,
21 September 2018, both days inclusive. Payment of the dividend will be made to shareholders on Tuesday,
25 September 2018. In respect of dematerialised shares, the dividend will be transferred to the CSDP
accounts/broker accounts on Tuesday, 25 September 2018. Certificated shareholders’ dividend payments will be
deposited on or about Tuesday, 25 September 2018.

A shares in issue at the date of declaration of the dividend: 1 184 496 438
B shares in issue at the date of declaration of the dividend: 1 086 114 294

Fortress' income tax reference number: 9218846179

21 August 2018


Lead sponsor
Java Capital

Joint sponsor
Nedbank Corporate and Investment Banking

Date: 21/08/2018 05:39:00 Produced by the JSE SENS Department. The SENS service is an information dissemination service administered by the JSE Limited ('JSE'). 
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