Specialist providers of capital protected funds in New Zealand

2017 TAX NOTICE

Please note: as of November 2016 Liontamer ceased to operate as an investment manager. The company has been wound-up and therefore will not be issuing any new investment products. All previously issued Liontamer funds have now matured and all proceeds have been distributed to unitholders.

Below is a brief overview of the tax rules in relation to the Liontamer range of funds. However, for taxation advice relevant to your personal circumstances, we strongly recommend that you consult your tax adviser.

Background
Each Liontamer fund is an Australian unit trust which should be treated as a “foreign company” for New Zealand tax purposes. This means that the Foreign Investment Fund (FIF) tax rules may apply to your Liontamer investment(s).

If you hold Liontamer investments that you purchased before 1 April 2015, you may need to establish the market value of each such investment as at 1 April 2016 and 31 March 2017 in order to calculate your tax liability for the 2016/17 income year.

Following consultation with the Inland Revenue in 2012, Liontamer recommends that unitholders use the Net Asset Value to value our funds for the purposes of calculating their tax liability under the Fair Dividend Rate or Comparative Value methods.

The remaining Liontamer funds matured during the 2016/17 tax year. The relevant maturity price and the date the fund matured are shown in the enclosed Tax Table. How you will be taxed on your maturity proceeds will depend on whether or not you are a de minimus investor (see below) and also on the withdrawal method used at the time; repurchase or redemption. Liontamer recommends that you consult with your accountant or tax adviser to confirm the appropriate tax treatment of your maturity proceeds.

Brief recap of taxation rules
The FIF rules will not apply to you if you are classified as a de minimus investor, i.e. the total cost of all your foreign investments on a portfolio basis is $50,000 or less (excluding the cost of certain Australian listed investments and certain other investments), and you are investing in your own capacity (i.e. not as a trustee or through a trust or company).

If the FIF rules do not apply to you then, in general, the proceeds from any maturing fund should be treated as a capital gain (non-taxable) unless you are a revenue account holder or you selected to have your units redeemed at maturity. Revenue account holders are those who acquired their units with the purpose of resale, are in the business of dealing in units or shares, or acquired their units as part of a profit making undertaking or scheme. Any distribution of annual returns should be treated as taxable income.

If the FIF rules do apply to your foreign investments you need to use an authorised calculation method to determine the taxable income from your units, such as the Fair Dividend Rate method, Comparative Value (CV) method (for individuals or trustees) or the Cost Method.

Examples of how these methods work:

Individuals or trustees that choose to apply the CV method must do so on a portfolio basis for all investments subject to the FIF rules.

The Inland Revenue issued a determination on 28 May 2010 which allows investors in units of Liontamer trusts which meet certain criteria contained in the determination to adopt the FDR method. We believe that all existing Liontamer trusts satisfy these criteria, with the exception of GLOBAL Series 1 (Trust 13), which matured in November 2010.

If you need further tax information about, for example, calculating the $50,000 threshold or using an authorised calculation method and the rules around, and consequences of, using each method, refer to the offer documents for the investment you hold (available on our website www.liontamer.com) and consult your tax adviser.

Please note
The information in this update is general and is not intended as specific taxation advice. All investors should seek independent tax advice in relation to their own individual circumstances.

2017 TAX NOTICE - LIONTAMER FUND VALUES
Trust No. Fund Name Start Date 1/04/2016
Market Value
($/unit)
31/03/2017
Market Value
($/unit)
Maturity Date
(if during previous
tax year)
Return at
Maturity
($/unit)
35 GLOBAL Series 7
Protected units
18/06/2010 $1.5699 - 18/06/2016 $1.5563
35 GLOBAL Series 7
Unprotected units
18/06/2010 $1.8188 - 18/06/2016 $1.8066
36 GOLD Series 1 01/10/2010 $1.0372 - 01/10/2016 $1.0097
37 COMBI Series 7 14/07/2011 $0.9828 - 14/07/2016 $1.0000

The values shown in the table above are market values for tax purposes based on the price at which investors can exit the relevant fund. These values may differ from the hold-to-maturity (HTM) value published on our website. The HTM value represents what the value of each unit would be assuming it was maturing today and had been held for the full term. By making these assumptions, we can provide a hypothetical value which reflects the relevant level of capital protection plus the formula of returns which apply at maturity. The HTM value gives investors an indication of how their investment is performing at the time the calculation is made and does not represent the current Market Value.