Investors in Scottish & Newcastle, the subject of a takeover bid by beer giants Carlsberg and Heineken, may receive an unsolicited capital gains tax (CGT) bill on their cash pay, although they will not have sold any shares, warns Brewin Dolphin.

Investment manager Brewin Dolphin said that, if the offer were in cash only, many longstanding shareholders could be forced to pay tax on the gains they have accrued when they receive the cash, according to MoneyMarketing.

Brewin Dolphin is urging the bidding companies to offer a loan note as an alternative to the cash offer to avoid CGT liability next year at a time coinciding with the loss of indexation relief.

‘We believe this is unfair, especially as it will hit long standing loyal shareholders, many of them not surprisingly in Scotland and the North East,’ Charlotte Black, Brewin Dolphin director of corporate affairs, said.

Further reading:

Scottish & Newcastle brew up claim against PwC

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