A company may from time to time issue bonus shares to its shareholders, usually at a predetermined ratio, such as one bonus share for every ten shares held.
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When a bonus is issued, shareholders may receive from the company:
Dividend reinvestment schemes include the following:
Under these schemes, a shareholder may arrange for the company to automatically:
The following table describes share splits and consolidations.
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A... |
Occurs when a company... |
Share split |
Divides its shares into a larger number of shares of lower value. For example, one share becomes three. |
Share consolidation |
Converts its shares into a smaller number of shares of higher value. For example, three shares become one. |
A number of companies have employee share plans or schemes, which provide the opportunity to share in the ownership and profits of the company.
There are generally two types of share plans offered:
Shares from company employee plans or schemes are exempt from income and assets testing as they are not financial assets [5] of a pensioner until the pensioner becomes the legal owner by paying for the shares in full. When the pensioner becomes the legal owner the shares are treated in the same manner as ordinary listed shares.
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In a few exceptional circumstances, dividends from employee share plans or schemes are assessed as income if it is quite clear that under a particular plan, they are paid directly to the pensioner.
According to section 5J(1) [12] of the VEA a financial asset means;
Links
[1] https://clik.dva.gov.au/user/login?destination=node/16005%23comment-form
[2] https://clik.dva.gov.au/book/export/html/16005#tgt-cspol_part9_ftn497
[3] https://clik.dva.gov.au/book/export/html/16005#tgt-cspol_part9_ftn498
[4] https://clik.dva.gov.au/book/export/html/16005#tgt-cspol_part9_ftn499
[5] https://clik.dva.gov.au/%23
[6] https://clik.dva.gov.au/book/export/html/16005#tgt-cspol_part9_ftn500
[7] https://clik.dva.gov.au/compensation-and-support-policy-library/part-9-principles-determining-pension-rate/95-deeming-provisions/955-deeming-shares-investments/forms-income-share-investments
[8] https://clik.dva.gov.au/book/export/html/16005#ref-cspol_part9_ftn497
[9] https://clik.dva.gov.au/book/export/html/16005#ref-cspol_part9_ftn498
[10] https://clik.dva.gov.au/book/export/html/16005#ref-cspol_part9_ftn499
[11] https://clik.dva.gov.au/book/export/html/16005#ref-cspol_part9_ftn500
[12] http://clik.dva.gov.au/legislation-library