Maria Bekiaris

An im­por­tant de­ci­sion has to be made: hold or sell?

Money Magazine Australia - - CONTENTS - Maria Bekiaris

It’s al­ways a sad time when a loved one passes away and if they leave you some­thing in their will of­ten you’re not in the best state of mind to make de­ci­sions.

If you have in­her­ited shares, though, an im­por­tant choice you will need to make is whether you will hold onto the in­vest­ment or sell it. If you have re­ceived shares in more than one com­pany you may de­cide to keep some and ditch the rest.

Look at each com­pany as if you were de­cid­ing to buy those shares now. Do you think the out­look is good, how has the com­pany been per­form­ing and what’s hap­pen­ing in the mar­ket?

Also think about how th­ese fit in with the rest of your port­fo­lio. Do you al­ready own shares in the com­pany, for ex­am­ple?

You should also take into ac­count the tax im­pli­ca­tions when de­cid­ing whether

to keep the shares or sell them. You will have to pay cap­i­tal gains tax if you make a profit when you sell the shares.

If the per­son you in­her­ited the shares from bought them be­fore Septem­ber 20, 1985, the cost base will be the mar­ket value of the shares on the date they died – not the date you re­ceived the shares.

Also add any re­lated costs in­curred by the le­gal per­sonal rep­re­sen­ta­tive, says the tax of­fice.

If the ex­ecu­tor has had the as­set val­ued, ask for a copy of the re­port. If not, you’ll need to get your own val­u­a­tion.

If the de­ceased per­son bought the shares on or after Septem­ber 20, 1985, the cost will be the price they bought them for plus any re­lated costs, as well as those in­curred by the le­gal per­sonal rep­re­sen­ta­tive, says the tax of­fice. The ex­ecu­tor should be able to give you th­ese de­tails.

If you opt to keep the shares, then you will need to ar­range for them to be trans­ferred into your name.

If you’re not the ex­ecu­tor of the will, check with that per­son first to find out about the sta­tus of the shares, as they may have al­ready ar­ranged for them to be trans­ferred to the es­tate.

If the shares are CHESS-spon­sored, you’ll need to go to the de­ceased per­son’s bro­ker to ar­range the trans­fer. You can iden­tify CHESS-spon­sored shares be­cause they will have a holder iden­ti­fi­ca­tion num­ber (HIN), which be­gins with an “X”.

If the shares are is­suer-spon­sored they will have a se­cu­ri­ty­holder ref­er­ence num­ber (SRN) be­gin­ning with an “I”.

This gen­er­ally means they were pur­chased in a float or ac­quired from a de­mu­tu­al­i­sa­tion. An ex­am­ple is IAG shares, which many peo­ple ac­quired from the de­mu­tu­al­i­sa­tion of the NRMA.

If they are is­suer-spon­sored, you can get in touch with one of the stock­mar­ket trans­fer com­pa­nies, Com­put­er­share or Link Mar­ket Ser­vices, to help you with the trans­fer.

Newspapers in English

Newspapers from Australia

© PressReader. All rights reserved.