Taxes and dividends: The UK evidence
This paper provides empirical evidence on the simultaneous effects of both corporation and personal income taxes on dividend payment adjustments and on the behaviour of share prices on the ex-dividend dates. The results show that companies set their dividend policies to minimise their tax liability...
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| Veröffentlicht in: | Journal of banking & finance 1996-04, Vol.20 (3), p.455-472 |
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| container_end_page | 472 |
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| container_issue | 3 |
| container_start_page | 455 |
| container_title | Journal of banking & finance |
| container_volume | 20 |
| creator | Lasfer, M.Ameziane |
| description | This paper provides empirical evidence on the simultaneous effects of both corporation and personal income taxes on dividend payment adjustments and on the behaviour of share prices on the ex-dividend dates. The results show that companies set their dividend policies to minimise their tax liability and to maximise the after-tax return of their shareholders. In particular, firms that are unable to deduct the advanced corporation tax from their tax liability are found to pay low dividends. In addition, consistent with the tax hypothesis, we find that the differential taxation of dividends and capital gains results in a decrease in ex-day share prices by significantly less than the amount of the dividend. There is no evidence of a tax-induced dividend clientele. |
| doi_str_mv | 10.1016/0378-4266(95)00012-7 |
| format | Article |
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| fulltext | fulltext |
| identifier | ISSN: 0378-4266 |
| ispartof | Journal of banking & finance, 1996-04, Vol.20 (3), p.455-472 |
| issn | 0378-4266 1872-6372 |
| language | eng |
| recordid | cdi_proquest_miscellaneous_59728351 |
| source | RePEc; PAIS Index; Access via ScienceDirect (Elsevier) |
| subjects | Banking Corporate taxes Corporations Dividend policy Dividends Ex dividend Ex-day price behaviour Finance Great Britain Imputation tax system Income tax Personal taxes Rates of return Statistical analysis Stock prices Stock returns Stocks Studies Tax aspects Tax policy Taxation Taxes United Kingdom |
| title | Taxes and dividends: The UK evidence |
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