putting the "o" in dyor, page-5

Coppertop137,

Great post, thumbs up, even though I don't agree with all of it.

I have some questions for you (or anyone else who knows) in relation to the following you wrote:

"If you get 10 cents distribution as 100% stock and (let us assume) your tax rate is 46.5% including the Medicare levy then you need to sell just under half your stock that has been issued to pay your tax bill. And if you have to do this then, yes you will get diluted."

The question is:
How will ATO value your (stock) dividend? Will it be SP when declared or would it be when you sell the stock or another way?

I'm asking because I don't know the answer. This is part of my own research because I may buy back in.

Question 2. To keep numbers simple, if SP is 40c at dividend date, and dividend is 100% shares, I calculate an extra 25% increase in number of shares. Am I right?