Fund pays out to beat new tax rate
The Bristol-based firm announced a first half dividend of 9.6p for all shareholders in a bid to pay out as much as possible in the current tax year.
Peter Hargreaves and Stephen Lansdown, who between them own more than 55 per cent of the group, will pick up around 14.6m and 10.5m respectively after the windfall on March 26.
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Hide AdThe group will pay out 44.6m in total for the dividend, said the company. But it stressed it was a one-off dividend increase and would not set a new bar.
The company added: "Given the 10 per cent increase to the top rate of tax taking effect in the next tax year and uncertainty brought by the impending election, the board has resolved that it is appropriate to pay as much dividend as possible prior to the end of the current tax year."
Hargreaves announced the bumper dividend as it reported a 16 per cent rise in underlying interim pre-tax profits for the final six months of 2009, to 43.1m.
It saw funds under management increase by 58 per cent to 15.6bn thanks to the recent stock market bounce-back – and it predicted the increase in the limit for tax-efficient individual savings accounts (ISA) to 10,200 would give a boost to full-year business.
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Hide AdBut Mr Hargreaves, chief executive, gave a cautious view of prospects due to the general election and as low Bank of England base rates are expected to hit the firm's second half income from interest.