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Premium Income Corporation

 

PIC.PR.A
PIC.A

Distributions & Tax

Preferred shares pay fixed cumulative preferential quarterly cash distributions in the amount of $0.215625 per Preferred share representing a yield on the original issue price of the Preferred shares of 5.75% per annum.

Currently the Fund is paying distributions of $0.81276 per share per annum on the Class A shares on a quarterly basis. The Fund intends to continue to pay distributions at this rate on the Class A shares until the NAV per unit (consisting of one preferred share and one Class A share) reaches $25.00 at which point the Class A distribution will be based on 8.0% of the NAV of the Class A share.

Most Recent Distributions

Ticker Distribution
Date
Current
Distribution
Current
Yield*
Distributions
Since Inception
PIC.PR.A 2017-10-31 $0.22                     5.69% $18.32                    
PIC.A 2017-10-31 $0.20                     10.60% $23.79                    

 

Tax Benefits

Distributions from the Fund may have significant tax benefits which results in higher after-tax cash flow than if the income had been earned outside of the Fund. Distributions on the Preferred Shares will generally be classified as dividend income or a return of capital for tax purposes. It is expected that the distributions on the Class A shares will mainly be comprised of capital gains or return of capital. To the extent that any portion of the distribution is ordinary taxable dividends and not capital gains dividends, they will be eligible dividends. The Fund will generally earn dividends on portfolio securities, interest income on cash balances and option premium income which is generally taxed as capital gains. Some portion of a distribution may be considered a return of capital for tax purposes, which is not included in an investor’s taxable income for a year, but will reduce the adjusted cost base of the shares, by the amount received. The reduction in the adjusted cost base of the shares is ultimately taxed as a capital gain when the shares are sold for investors who hold their shares as capital property.

The actual breakdown of distributions for tax purposes will be provided to unitholders annually in March following receipt of the information from the Fund's custodian. This information will also be posted on the website as soon as it is available.

This information is of a general nature only and does not constitute legal or tax advice to any particular investor. Accordingly, prospective investors are advised to consult their own tax advisors with respect to their individual circumstances.

 

Class A Share Distribution Amount: Pursuant to the consolidation of Class A shares announced October 29, 2010. The quarterly distribution effective after October 30, 2010 will adjusted by the consolidation ratio. The new quarterly distribution will be $0.20319 per Class A share.

Class A Share Floating Distribution NAV Threshold: Shareholders of the Class A shares are advised that pursuant to the consolidation of the Class A shares on November 1, 2010, the Unit NAV threshold of $22.50 above which the distribution on the Class A shares would float and thereafter be based on 8.0% of the Class A net asset value per unit, has been adjusted to reflect the consolidation. The Class A shares were consolidated on the basis of 0.738208641 new shares for each old share resulting in a higher net asset value per share. The NAV threshold has therefore been increase to $25.00 to reflect the approximate consolidation ratio. Once the NAV per Unit reaches this threshold, the distribution on the Class A shares will float and be based on 8.0% of the net asset value per Class A share.

Note:

For the 2007 taxation year, to the extent that any portion of the distributions are ordinary taxable dividends and not capital gains dividends, they will be eligible dividends.

 

Tax and Distribution Summary - PIC.PR.A Year Selection: 

 

  Regular Distribution Special Distribution Total Distribution Capital Gains
per Unit
Div. Income per Unit Return of Capital Other Income Foreign Dividend Income Witholding Taxes Paid
October 2017 0.215625 0.000000 0.215625 0.000000 0.000000 0.000000 0.000000 0.000000 0.000000
July 2017 0.215625 0.000000 0.215625 0.000000 0.000000 0.000000 0.000000 0.000000 0.000000
April 2017 0.215625 0.000000 0.215625 0.000000 0.000000 0.000000 0.000000 0.000000 0.000000
January 2017 0.215625 0.000000 0.215625 0.000000 0.000000 0.000000 0.000000 0.000000 0.000000
Total for 2017     $0.862500 $0.000000 $0.000000 $0.000000 $0.000000 $0.000000 $0.000000
Percent (%)       0.00% 0.00% 0.00% 0.00% 0.00% 0.00%
Total Distributions
to Date
    $18.324457            

 

Tax and Distribution Summary - PIC.A

 

  Regular Distribution Special Distribution Total Distribution Capital Gains
per Unit
Div. Income per Unit Return of Capital Other Income Foreign Dividend Income Witholding Taxes Paid
October 2017 0.203190 0.000000 0.203190 0.000000 0.000000 0.000000 0.000000 0.000000 0.000000
July 2017 0.203190 0.000000 0.203190 0.000000 0.000000 0.000000 0.000000 0.000000 0.000000
April 2017 0.203190 0.000000 0.203190 0.000000 0.000000 0.000000 0.000000 0.000000 0.000000
January 2017 0.203190 0.000000 0.203190 0.000000 0.000000 0.000000 0.000000 0.000000 0.000000
Total for 2017     $0.812760 $0.000000 $0.000000 $0.000000 $0.000000 $0.000000 $0.000000
Percent (%)       0.00% 0.00% 0.00% 0.00% 0.00% 0.00%
Total Distributions
to Date
    $23.789320            

 

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