Investors in Scottish & Newcastle may receive an unsolicited capital gains tax bill even though they will not have sold any shares, warns Brewin Dolphin.
S&N is currently the subject of a takeover bid by Dutch firms Carlsberg and Heineken, who have made a cash offer for the company.
Brewin Dolphin says if the offer is in cash only many longstanding shareholders could be forced to pay tax on the gains they have accrued when they receive the cash.
The investment manager is pushing the bidding companies to offer a loan note as an alternative to cash, which would avoid an immediate CGT liability arising at the time of the takeover.
Brewin Dolphin director of corporate affairs Charlotte Black says otherwise investors will be liable for CGT next year at a time that coincides with the loss of indexation relief.
She says: “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.”