7c div - 15.5% income return @ $0.45 per share, page-26

My Accountant was baffled by AJA's treatment of the dividend for AJA for FY09.

Apparently AJA received a ruling from the ATO for FY2009 allowing them to treat 100% of income as a dividend to their shareholders, even though what the shareholder got was net 5 cents per share as distributable income.

For example my Net distribution was $3,500.00 (was holding 70,000 shares at the time), but for taxation purposes my taxable income was $7,202.18 (You will find this on the AJA Tax Statement under "Taxable Income"

In essence I am paying tax on $3,702.18 which I haven't received! So for me it is an additional $555.00 in tax for income i haven't received (note the i am using 15% tax rate as it was part of my SMSF).

He did to attempt to debate the issue with the folks at AJA and the share registry that this treatment does not make sense and that it wasn't clearly defined in any documentation released by AJA.

But as i made significant profit on the heads of about $17k is wasn't worth arguing about as he really wasn't getting anywhere with them.

Now i don't knowi f this was a one off ATO ruling for FY09 only or whether this will be on going.

Originally i had 140,000 shares but sold half prior to the dividend, so i was fortunate there.

So if you are on a higher tax rate you won't be happy.

Please check with your accountant!

I exited AJA in Nov @ 50.0 cents and Dec @ 44.0 cents.