Betashares Capital Ltd has released the estimated annual distribution breakdown for its Global Income Leaders ETF (INCM) for the 2024-25 financial year, highlighting significant foreign income and capital gains components.
- Estimated distribution dominated by 53.21% foreign sourced income
- Non-taxable discounted capital gains represent 68.69% of distribution
- 100% estimated cash distribution with notable cost base adjustments
- Tax offsets include foreign income tax offset of 9.18%
- Fund operates under Attribution Managed Investment Trust (AMIT) tax regime
Overview of Distribution Components
Betashares Capital Ltd has disclosed the estimated annual distribution breakdown for its Betashares Global Income Leaders ETF (ASX, INCM) for the financial year ending 30 June 2025. This detailed breakdown provides investors with insight into the composition of income and capital gains attributed to unitholders, essential for tax planning and understanding the fund’s income sources.
Foreign Income and Capital Gains Take Centre Stage
The distribution is heavily weighted towards foreign sourced income, which accounts for approximately 53.21% of the total distribution. This reflects the fund’s global income focus, tapping into overseas markets to generate returns. Additionally, a significant portion; 68.69%; is attributed to non-taxable discounted capital gains, underscoring the fund’s strategy of realising gains in a tax-efficient manner for investors.
Cash Distribution and Tax Adjustments
Investors can expect a 100% estimated cash distribution, ensuring full payout of income generated during the year. However, the filing also reveals a substantial negative adjustment to the cost base (-132.96%), which may affect the capital gains tax calculations for investors when they eventually sell their units. Tax offsets include a foreign income tax offset of 9.18%, reflecting withholding taxes paid overseas, which can help reduce Australian tax liabilities.
Implications of the AMIT Structure
The fund operates as an Attribution Managed Investment Trust (AMIT), a tax structure designed to provide greater transparency and flexibility in attributing income and capital gains to investors. Under AMIT rules, the fund can distribute cash that differs from the taxable income attributed to unitholders, which explains some of the adjustments seen in the filing. The final tax component details will be provided in the AMMA statement, expected later, which investors should review carefully for accurate tax reporting.
Looking Ahead
This distribution breakdown highlights the fund’s continued emphasis on global income streams and tax-efficient capital gains. Investors should consider these components in the context of their personal tax situations and the broader market environment. As always, professional advice is recommended to navigate the complexities of ETF distributions and tax implications.
Bottom Line?
The INCM ETF’s 2025 distribution mix signals a strong global income focus with tax-efficient gains, setting the stage for investor tax planning ahead.
Questions in the middle?
- How will the significant negative cost base adjustment impact investor capital gains tax liabilities?
- What are the final tax components expected in the forthcoming AMMA statement?
- Could shifts in foreign income sources affect future distribution stability or amounts?