The db X-trackers Harvest CSI 300 China A-Shares Fund (ASHR) is releasing its reserve related to capital gains tax back to the fund.
This release will add USD0.05522 per share to the fund’s net asset value (NAV).
Effective at market close on 24 April, the fund will no longer reserve 10 per cent of its realized and unrealized gains from its A-Shares investments to meet any potential withholding tax liability that may be imposed by China, except with respect to realized and unrealized gains from the fund’s investments in A-Shares of “land-rich” enterprises, which are companies that have greater than 50 per cent of their assets in land or real properties in China.
If China begins applying tax rules regarding the taxation of income from A-Shares investment to Renminbi Qualified Foreign Institutional Investors and/or begins collecting capital gains taxes on such investments, the fund could be subject to withholding tax liability. The impact of any such tax liability on the fund’s return could be material.