VAS incorrect dividend amount - Foreign source income component issue?

Hi team,

I am having an issue with VAS (ASX): Sharesight has picked up some foreign source income component as part of the dividend and the total income amount compared to what is shown on the statement from computershare is off by exactly that foreign source income amount: so if I was to remove the foreign source income component, the total income on sharesight and on the statement would match : has anyone else has experienced the issue? Any ideas what could be causing it?

There are no details in the statement from computershare, so no idea whether this foreign source income component should be in there - however I am assuming if the data has been fed to sharesight there must be a reason for it.

I am experiencing this issue looking at distributions from 18 July 2016 and 19 October 2016. Previous distributions do not have this issue. I also hold VGS which does not present the issue either.

Would be very keen to hear if anyone has experienced this issue as well.

I am also surprised sharesight has picked VAS as non trust income: I believe this is incorrect?

Thank you all
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  • Hi, same issue for me with IAF (iShares ETF). Also unsure where it is coming from so I have manually removed it.
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  • Hi,

    We have carried out a large program of work over the last year and a half in relation to our handling of ETF components.

    The last of those changes went live yesterday.

    The issues you have seen with VAS and IAF around foreign source income have been resolved.

    In fact, we've gone a lot further than that. We have actually loaded correct end of year tax details for all ETF's managed by Computershare for the tax year ending 30 June 2017. We will do the same for the tax year ending 30 June 2018 as soon as we can get hold of that info.

    If you run your taxable income report for the 2016- 2017 tax year, you will likely see a little light bulb icon (introduced yesterday) alongside each of your Australian ETF distributions. If you click on the icon and follow the instructions displayed, you can update all your ETF distributions with accurate end of year tax details. The actual cash paid out will not differ, but the component breakdown will be updated to reflect the final position of the ETF at year end.

    We are pretty excited by the work we've done in this space, so here is a quick snapshot of some of the more important changes we've made recently:

    1. Ensuring that all Exchange Traded Fund payouts are treated as ‘Trust Income’ by default. We've also done the same for Trust Units.

    2. Expanding our ETF payout form to include all distribution components required for Australian tax reporting.

    3. Ensuring that ETF distributions fall within the correct tax year. The tax year for ETF’s is determined based on when fund income was earned and not when it was disbursed to unit holders. On the taxable income report, you now see a little information icon that explains the presence of distributions where the ex date falls outside of the tax year, but are still included in that tax year.

    4. The addition of a ‘Show holding totals’ flag under Advanced Settings on the Taxable Income Report. This flag is a useful tool to use when reconciling your Sharesight distribution data with the annual taxation statement you receive at the end of the tax year for each ETF you own.

    5. The addition of a warning icon alongside each ETF payout where the components that make up the distribution have not been finalised at year end.

    6. The update of all ETF distribution data for ETF’s managed by Computershare for the tax year ended 30 June 2017.

    7. When we do receive final end of year tax breakdown’s you can more easily ‘reset’ any confirmed payouts and benefit from our updated payout data.

    8. If you have confirmed an ETF distribution and we subsequently receive directly from the registry correct EOY tax details, we now show a little light bulb icon alongside each distribution, on both the holding overview and taxable income report. Clicking on the icon displays a message outlining how to quickly 'reset' to the updated corp action and take advantage of the updated data we have.

    9. Last night we went live with probably our biggest visual change in this space with the introduction of a new 'Income Tax Return' section at the bottom of the Taxable Income Report.

    This new section only displays on Australian portfolios set to the individual / trust tax entity type (although it's only relevant to individual tax entities).

    This new section is really just a tool to assist you with your tax return. We've provided field references to the relevant sections on the Australian Income Tax Return for Individuals and Income Tax Return for Individuals (supplementary section) and the totals required for the Income Tax Return based on your non trust and trust income.

    You will no doubt see a few announcements from us in the coming weeks explaining these changes in a lot more detail.

    Regards
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    • Hi again Ben,
      I am wondering whether you have a rough idea of when the light bulb might appear for the FY just ended?
      I am guessing this might be when the fund issues the tax statement? Looking back on the last couple years, Vanguard has issued their statements on the 21st July - so perhaps in a couple days this will be available for update?
      Amazing feature btw.
      Thanks
    • Hi,

      We receive our distribution breakdowns directly from Computershare. I spoke with our contact there a couple of days ago and they haven't yet received the details they need from each ETF.

      Once they do they will forward on the data to us. It will take us approx two weeks to load it into our system from that point

      Our goal has been to have all the ETF distribution data for Computershare ETF's loaded in August. At this stage we are on track to do that.
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  • Hi Ben,

    Please can you clarify:

    1. Ensuring that all Exchange Traded Fund payouts are treated as ‘Trust Income’ by default. We've also done the same for Trust Units.

    I have VHY and VIF funds, and VHY is classed as Trust Income and VIF as Non-Trust Income, by default. I have even reverted back to default to check.

    Should they both be Trust Income?

    And does 'Trust' refer to the investement itself (the partcular ETF) or the individual investors' personal circumstances e.g. Individual investor or Discretionary Trust?

    Thanks,

    Niv
    • Hi Niv,

      Yes, you should treat all Exchange Traded Fund payouts as 'Trust Income'.

      We now set all ETF's and Unit Trust payouts by default as trust income , however we do have a task which will be complete in the next week or so to ensure that any existing holdings previously added to peoples portfolios are updated to reflect this new default treatment. We've performed it already for a large number of ETF's, but I do notice that VIF is on our list to do.

      In the meantime, you can open your VIF holding, open the Holding Settings bottom right and change the default income type to 'Trust'.

      This will set all payouts moving forward as trust income.

      We use the term 'Trust' in reference to the entity issuing the payouts and not in relation to the unit holder receiving the payouts.

      Regards
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