Author Topic: SAC  (Read 5066 times)

devan

  • Global Moderator
  • I've just arrived
  • *****
  • Posts: 30
  • Karma: +2/-0
    • View Profile
SAC
« on: October 21, 2013, 03:49:33 pm »
SA Corporate Real estate fund
They seem to have fairly high divi based on (http://www.topyields.nl/Top-dividend-yields-of-JSE.php).
anyone got more info on this company??
Is it worth investing in??

Moonraker

  • Hero Member
  • *****
  • Posts: 1035
  • Karma: +27/-0
    • View Profile
Re: SAC
« Reply #1 on: October 21, 2013, 04:34:01 pm »
SA Corporate Real estate fund
They seem to have fairly high divi based on (http://www.topyields.nl/Top-dividend-yields-of-JSE.php).
anyone got more info on this company??
Is it worth investing in??

It's a 'Hold'. I would rather go for RIN (soon to be “RI PLC”, JSE share code: RPL due to inward listing.
Nice Rand hedge.


devan

  • Global Moderator
  • I've just arrived
  • *****
  • Posts: 30
  • Karma: +2/-0
    • View Profile
Re: SAC
« Reply #2 on: October 21, 2013, 08:45:29 pm »
thanks moonraker will look at that, but the dividends on SAC seems extremely good. Any idea why that is?? No other company is giving anything close to that!!

Patrick

  • Administrator
  • Hero Member
  • *****
  • Posts: 2105
  • Karma: +35/-2
    • View Profile
Re: SAC
« Reply #3 on: October 21, 2013, 09:49:43 pm »
Dividends are huge, on a normal payout ratio too. One thing to remember is that with property stocks you're not actually getting a dividend, you're getting interest, so it'll be taxed at your marginal rate. Here's the longest term graph I could get:

Moonraker

  • Hero Member
  • *****
  • Posts: 1035
  • Karma: +27/-0
    • View Profile
Re: SAC
« Reply #4 on: October 22, 2013, 10:18:39 am »
Dividends are huge, on a normal payout ratio too. One thing to remember is that with property stocks you're not actually getting a dividend, you're getting interest, so it'll be taxed at your marginal rate.

I wouldn't count that as being of concern at all. With average increases in distribution every year in the order of at least 7% (more in previous years), you are sitting pretty and without too much risk. Remember over the past 10 years listed property has returned nearly 300% more than equities .. see graph. Trouble is, most don't understand listed property and hence the silly close correlation with bond yields.

Look beyond bond yields to understand property returns

devan

  • Global Moderator
  • I've just arrived
  • *****
  • Posts: 30
  • Karma: +2/-0
    • View Profile
Re: SAC
« Reply #5 on: October 22, 2013, 10:46:40 am »
Dividends are huge, on a normal payout ratio too. One thing to remember is that with property stocks you're not actually getting a dividend, you're getting interest, so it'll be taxed at your marginal rate. Here's the longest term graph I could get:

How do they determine that it is interest when it is paid as divis?? Do they not take the divi tax directly?? are you suppose to declare it as interest in your tax return??
Also, not sure what that graph was showing :) ... mind explaining your point??

Moonraker

  • Hero Member
  • *****
  • Posts: 1035
  • Karma: +27/-0
    • View Profile
Re: SAC
« Reply #6 on: October 22, 2013, 12:00:36 pm »
Dividends are huge, on a normal payout ratio too. One thing to remember is that with property stocks you're not actually getting a dividend, you're getting interest, so it'll be taxed at your marginal rate. Here's the longest term graph I could get:

How do they determine that it is interest when it is paid as divis?? Do they not take the divi tax directly?? are you suppose to declare it as interest in your tax return??
Also, not sure what that graph was showing :) ... mind explaining your point??

Some clarification.
In the past one needed to draw a distinction between those listed property companies that were designated Property Loan Stock companies (PLS's), like Growthpoint, and Property Unit Trust companies (PUT's), like SAC.
The PUT's distributed all their earnings as interest, i.e. fully taxable, just like interest from a fixed deposit etc.
The PLS's distributed their earnings in the form of debenture interest plus dividends, usually in the ratio of 1000 to 1.
So, R1000 would be declared as interest and R1 as local dividends in your tax return (subject to withholding tax).

Now we have a slightly different scenario due to the introduction of the internationally recognised and accepted REIT (Real Estate Investment Trust)
structure. PLS's and PUT's will be placed on the same footing under this all equity REIT structure.
This means that the full income distribution received by shareholders will be in the form of a taxable dividend, without withholding tax being imposed.
In other words, although the distribution is termed 'dividend' it is in fact interest and will be regarded by SARS as 'rental income' being fully taxable.
The change to the REIT structure will therefore not have an impact on you as an investor when compared to pre-REIT.
The benefits go to those listed property companies that have applied for REIT status, as they will no longer be subjected to CGT when disposing of properties in their portfolios.


Moonraker

  • Hero Member
  • *****
  • Posts: 1035
  • Karma: +27/-0
    • View Profile
Re: SAC
« Reply #7 on: December 31, 2013, 06:07:01 pm »
SA Corporate Real estate fund
They seem to have fairly high divi based on (http://www.topyields.nl/Top-dividend-yields-of-JSE.php).
anyone got more info on this company??
Is it worth investing in??

It's a 'Hold'. I would rather go for RIN (soon to be “RI PLC”, JSE share code: RPL due to inward listing.
Nice Rand hedge.

Yes, I am happy with RPL, purchased end August @ 7.50; now 10.24. Obviously the weak Rand also played a small part.
NEP is another to look at.
So, listed property is not to be maligned - remember the divs. (taxable), but growing on average by 7-10% p.a. ####

Have a prosperous 2014.  :TU:

#### In the case of RPL, it is subject to 15% withholding tax being a listed foreign entity (it has a secondary listing on the JSE).
For tax purposes you would declare the gross div. under section 4216 and the same gross dividend under 'exempt local and foreign dividends'.


« Last Edit: December 31, 2013, 06:53:49 pm by Moonraker »