As of January 1, 2011, Bell Aliant Regional Communication Income Fund Unites (TSX: BA.UN) will complete the conversion from an income trust structure to a corporate structure.
Changes to Canadian taxation rules that come into effect on January 1st entail that Canadian income trusts will now be subject to taxation just as if they were corporations. These new taxation structures will be effective in January 2011.
Should You Sell Your Trusts Before 2011?
In the case of Bell Aliant, distributions are expected to decrease somewhat en route to becoming dividends, but this has already been priced into the stock.
The new company will trade as Bell Aliant, Inc.
If you hold units of BA.UN, these units will automatically become shares in Bell Aliant, Inc. This is known as the “default option” and there is nothing you need to do for the conversion to happen on your end. This is one of the great benefits of holding equities with a broker.
If you hold units of BA.UN through a transfer agent such as Computershare, you should already have received some time ago various notices as to how to proceed to exchange your shares for the new issue.
If you hold a paper certificate for BA.UN units, you will need to mail this back to the transfer agent, or walk into the branch of your discount broker and ask to have it deposited into your brokerage account, where it will be converted to shares of Bell Aliant.
If you owned units in BA.UN but declined to receive shareholder communication materials, you may not have received some of these notices. You should read up on the complete information on these income trust conversions on the Sedar website (www.sedar.com).
List of 45 Canadian Companies Still Operating As Income Trusts
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