Smurfit

How am I supposed to treat the recent acquisition of my Smurfit shares for assessment of capital gains? At €2.15, I would have incurred a loss but obviously the value of the Smurfit Stone Container Corp shares obtained from the "spin off" would reduce this. I calculate that they were worth about 85 cents per Smurfit share. At what price and date will I be deemed to have acquired these shares?

P.C., e-mail

Every time another listed company is taken private or split up, shareholders are put through the mill on capital gains and the treatment of shares in a split company. You'd have thought by now the Revenue would have a leaflet on the issue or forced individual companies to lay out the tax treatment of their proposals in offer documents. But perhaps the chaos will keep some people in employment.

My understanding is that you will be deemed to have acquired the Smurfit Stone shares at the time the takeover was declared unconditional. Until then, you did not separately own Smurfit Stone shares. The value of the spun-off shares in Smurfit Stone does not enter the equation until you eventually sell them.

In assessing any gain/loss on the original holding, the Revenue has yet to rule - don't hold your breath, it can take months - but I imagine if the Smurfit Stone shares were disbursed on the basis of one for every 16 Smurfit shares held, you would need to subtract one-sixteenth of the price of Smurfit Stone on the day the deal went through to gauge any liability.

That price was $13.80, giving your one-sixteenth a value of 86.25 US cents. Of course, you then have to contend with the currency exchange. On that day, the euro/dollar rate was $0.9959. That would give your Smurfit Stone stake per Jefferson Smurfit share a value of 86.61 cents.

Vodafone

As a holder of Vodafone shares, and given that the information is so scanty, how does one go about disposing of all or a portion of shares? What is the procedure? Also, is there any view on how they are likely to perform in the future?

Ms H.N., e-mail

To get rid of your shares, you must go to a stockbroker and ask them to do it for you. They will need your share certificate before carrying out the transaction. Stockbrokers' costs vary.

Some operate what is called an execution-only service. This is where the broker buys or sells on your instruction without offering advice or other help - something like Ryanair's no-frills policy.

But if you want professional advice - such as whether this is a good time to sell Vodafone or whether things will bounce back - you will need to opt for a full- service broker, which is more expensive.

Most stockbrokers provide both services. You will find them listed in the Yellow Pages or as members of the Irish Stock Exchange on its website www.ise.ie.

The fees are not massive but all brokerages charge a minimum fee and in the case of something like Vodafone where the amount of shares involved can be quite small, this is an issue. Shop around on fees.

As to a view on future performance, there are as many views as there are people giving them. In general, the advice at the moment is that the stock markets have fallen so badly that they

Technology must bounce back and that is probably good advice for all but the most scandal-ridden of traditional companies. and telecoms firms such as Vodafone are a different story.

It seems unlikely that these companies will hit the heady heights of the late 1990s again soon, if ever. All are stretched and many will not survive.

But Vodafone is one of the biggest and the assumption has always been that, for all its failings, it should be among the strongest in its sector when a recovery arrives. But as with all advice, this comes with a lot of ifs, buts and maybes.

Please send your queries to Dominic Coyle, Q&A, The Irish Times, D'Olier Street, Dublin 2 or e-mail to dcoyle@irish-times.ie. This column is a reader service and is not intended to replace professional advice. Due to the volume of mail, there may be a delay in answering queries. All suitable queries will be answered through the columns of the newspaper. No personal correspondence will be entered into.