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Shell accused over tax on UK investors

THE TIMES (UK): Shell accused over tax on UK investors

May 31, 2005 

By Gary Duncan 

SHELL yesterday faced accusations of unfairly inflicting heavy bills for capital gains tax on some British investors who hold shares in the Dutch arm of the oil giant.

Under Shell’s impending restructuring, shareholders in the British and Dutch arms of the group are to be issued with new shares in Royal Dutch Shell, an entity formed from the combination of the two.

 

However, Angela Knight, chief executive of the Association of Private Client Investment Managers, says several thousand mainly small UK investors in Royal Dutch will lose out. She says the Shell scheme is tax-neutral for shareholders in Shell Transport and Trading, and for Dutch and American investors in Royal Dutch Shell, but she had found that UK shareholders in the Dutch part of the group face an unavoidable capital gains charge.

 

Ms Knight is worried that most of those affected are elderly, and that Shell has not offered a loan note, which she says would solve the problems and is often used in such cases.

 

Shell said last night that the many tax jurisdictions involved meant it was “not possible to treat everyone equally on a post-tax basis”. But it said there were many provisions in UK tax law allowing people to “reduce or eliminate any cash tax payment” involved.

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