The first element of the cost base and reduced cost base of your new shares received as a result of the distribution from 21CF are as follows – for new News Corp:
- Class A common stock at 28 June 2013, $16.60
- Class B voting common stock at 28 June 2013, $16.50.
CGT event as a result of the distribution
A CGT event happened when you received your distribution on 28 June 2013. The capital proceeds received by a 21CF shareholder are equal to one quarter of the market value of a new News Corp share received at the time of distribution. Specifically, the capital proceeds in relation to each class of shares is as follows:
- $4.15 for each 21CF Class A common stock
- $4.12 for each 21CF Class B voting common stock.
There are different implications for you depending on whether you still held your 21CF shares as of 28 June 2013 when the separation happened.
If you held the shares on 28 June 2013
For 21CF shares you acquired after 19 September 1985* you must both:
- adjust the cost base and reduced cost base of your 21CF shares
- work out whether you have made a capital gain (you cannot make a capital loss on the separation).
*Shares acquired before 20 September 1985 are pre-CGT assets and, therefore, you disregard any capital gain or capital loss you make on them.
How do I adjust the cost base and reduced cost base of my 21CF shares?
The cost-base, or reduced cost-base of your 21CF shares is reduced by the amount of the capital proceeds you received (but not below zero). The capital proceeds of the CGT event are:
- $4.15 for each 21CF Class A common stock
- $4.12 for each 21CF Class B voting common stock.
For 21CF shares that had a cost base of less than $4.15 for class A shares and $4.12 for class B shares, reduce your cost base to nil. Your capital gain will be equal to the excess.