QFA INVESTMENTS (POORLY
PERFORMING AREAS) QUESTIONS
WITH COMPLETE ANSWERS
Key bbnumerical bbMeasures bbin bbAssessing bbShare bbValue bb- bbAnswer bbGross
bbDividend bbYield
Dividend bbCover
Earnings bbPer bbShare
The bbP/E bbRatio
Net bbAsset bbValue
Market bbCapitalisation
EBITDA
Dividends bbCompany bb- bbAnswer bbDividends bbfrom bbIrish bbresident bbcompanies bbare
bbassessed bbto bbincome bbtax bbunder bbSchedule bbF, bbat bbthe bbinvestor's bbmarginal
bbtax bbrate. bb
Dividends bbpaid bbby bbIrish bbresident bbcompanies bbare bbnormally bbsubject bbto
bbdividend bbwithholding bbtax bb(DWT) bbat bbstandard bbrate bbof bbtax, bbthat bbis,
bbcurrently bb25%. bb
The bbinvestor bbis bbtaxed bbon bbthe bbsum bbof bbthe bb(net bbdividend bbreceived bb+
bbDWT bbdeducted), bbwith bbthe bbDWT bbthen bbbeing bballowed bbas bba bbcredit bbor
bbdeduction bbfrom bbthe bbinvestor's bbtotal bbincome bbtax bbliability
Dividend bb- bbInvestor bb- bbAnswer bbWhere bban bbinvestor bbopts bbto bbreceive
bbdividends bbin bbthe bbform bbof bbshares bbfrom bban bbIrish bbresident bbcompany bb(scrip
bbdividend), bbinstead bbof bbcash, bbDWT bbis bbapplied bbto bbthe bbgross bbcash bbamount
bband bbthe bbnet bbamount bbis bbthen bbused bbto bbbuy bbshares bbfor bbthe bbinvestor bbat
bbthe bbpredetermined bbprice. bb
However, bbthe bbinvestor bbis bbstill bbliable bbto bbincome bbtax bbat bbtheir bbmarginal bbrate
bbon bbthe bbgross bbdividend, bbwith bballowance bbfor bbthe bbDWT bbdeducted bbat
bbsource, bbas bbif bbhe bbor bbshe bbhad bbreceived bbthe bbcash bbdividend bbpayment. bb
A bbsimilar bbsystem bboperates bbin bbrespect bbof bbdividends bbreceived bbon bbmany
bbforeign bbshares. bbCurrently, bbhowever, bbthere bbis bbno bbwith-holding bbtax bbon bbUK
bbdividends. bb
Revenue bbplan bbto bbmove bbto bban bbindividualised bbDWT bbrate bbat bbsome bbstage,
bbwhich bbwill bbbe bbbased bbon bbeach bbinvestor's bbown bbtax bbrate. bbThis bbwill bbsee
bbhigher bbrate bbtaxpayers bbhaving bba bbDWT bbof bbcurrently bb40% bbwith bbstandard
, bbrate bbtaxpayers bbhaving bba bb20% bbrate bbapplied. bbNo bbdate bbhas bbyet bbbeen
bbconfirmed bbfor bbthe bbchange.
Gross bbDividend bbYield bb- bbAnswer bbGross bbannual bbdividend, bbdivided bbby bbcurrent
bbshare bbprice
Dividend bbCover bb- bbAnswer bbA bbratio bbthat bbmeasures bbthe bbpotential bbfor bbfuture
bbcapital bbgrowth bbof bbthe bbfirm. bbIt bbmeasures bbhow bbeasily bbthe bbdividend bbcan
bbbe bbpaid bb(or bb'covered') bbout bbof bbthe bbcurrent bbprofits bbof bbthe bbfirm. bbIt bbis
bbcalculated bbby bbdividing bbthe bbprofit bbaccruing bbto bbshareholders bbby bbthe bblevel
bbof bbdividends.
Earnings bbPer bbShare bb- bbAnswer bbNet bbincome bbof bba bbcompany bbdivided bbby bbthe
bbnumber bbof bbshares
The bbP/E bbRatio bb- bbAnswer bbPrice bbper bbshare bbdivided bbby bbearnings bbper bbshare
Net bbAsset bbValue bb- bbAnswer bbValue bbof bba bbcompany's bbnet bbassets bbdivided bbby
bbthe bbnumber bbof bbshares
Market bbCapitalisation bb- bbAnswer bbNumber bbof bbissued bbshares bbx bbcurrent bbshare
bbprice. bbRepresents bbthe bbtotal bbvalue bbof bba bbcompany.
EBITDA bb- bbAnswer bbEarnings bbbefore bbinterest, bbtaxes, bbdepreciation, bband
bbamortization
The bbfollowing bbcan bbreclaim bbfrom bbRevenue, bbDIRT bbalready bbdeducted bbfrom
bbdeposit bbinterest bbif bbthe bbdepositor bbis bbnot bbotherwise bbliable bbto bbincome bbtax
bbon bbthe bbinterest bb- bbAnswer bbA: bbCompanies. bbIf bbthe bbcompany bbis bbnot bbtaxable
bbon bbits bbprofits bband bbincome, bbfor bbexample, bbhas bbsubstantial bbtrading bblosses
bbwhich bbit bbcan bboffset bbagainst bbits bbincome, bbit bbcan bbreclaim bbany bbDIRT
bbsuffered bbon bbdeposit bbinterest bbearned, bbwhere bbit bbhad bbnot bbcompleted bba
bbdeclaration bbto bbobtain bba bbDIRT-free bbreturn. bb
B: bbIndividuals bb(or bbtheir bbspouse/civil bbpartner) bbwho bbare bbover bbage bb65 bband
bbwhose bbtotal bbincome bbwas bbless bbthan bbthe bbrelevant bbincome bbexemption bblimit
bbin bbthe bbyear. bb
C: bbIndividuals bbwho bbare bbpermanently bband bbtotally bbincapacitated bbas bba bbresult
bbof bbpersonal bbinjury bbcan bbreclaim bbDIRT bbarising bbfrom bbthe bbinvestment bbof
bbcompensation bbawards, bbwhere bbthe bbinvestment bbreturns bbare bbthe bbsole bbor
bbmain bbincome bb(that bbis, bbmore bbthan bb50%) bbof bbthe bbindividual. bbThis bbalso
bbextends bbto bbthe bbinvestment bbof bbcompensation bbawards bbfrom bbthe bbHepatitis bbC
bbTribunal. bb
D: bbIndividuals bbwho bbreceived bbcompensation bbawards bbfor bbthalidomide bbchildren
bbcan bbreclaim bbDIRT bbarising bbfrom bbthe bbinvestment bbof bbsuch bbawards.
Exemption bbfrom bbDIRT bb- bbAnswer bbNon-residents
PERFORMING AREAS) QUESTIONS
WITH COMPLETE ANSWERS
Key bbnumerical bbMeasures bbin bbAssessing bbShare bbValue bb- bbAnswer bbGross
bbDividend bbYield
Dividend bbCover
Earnings bbPer bbShare
The bbP/E bbRatio
Net bbAsset bbValue
Market bbCapitalisation
EBITDA
Dividends bbCompany bb- bbAnswer bbDividends bbfrom bbIrish bbresident bbcompanies bbare
bbassessed bbto bbincome bbtax bbunder bbSchedule bbF, bbat bbthe bbinvestor's bbmarginal
bbtax bbrate. bb
Dividends bbpaid bbby bbIrish bbresident bbcompanies bbare bbnormally bbsubject bbto
bbdividend bbwithholding bbtax bb(DWT) bbat bbstandard bbrate bbof bbtax, bbthat bbis,
bbcurrently bb25%. bb
The bbinvestor bbis bbtaxed bbon bbthe bbsum bbof bbthe bb(net bbdividend bbreceived bb+
bbDWT bbdeducted), bbwith bbthe bbDWT bbthen bbbeing bballowed bbas bba bbcredit bbor
bbdeduction bbfrom bbthe bbinvestor's bbtotal bbincome bbtax bbliability
Dividend bb- bbInvestor bb- bbAnswer bbWhere bban bbinvestor bbopts bbto bbreceive
bbdividends bbin bbthe bbform bbof bbshares bbfrom bban bbIrish bbresident bbcompany bb(scrip
bbdividend), bbinstead bbof bbcash, bbDWT bbis bbapplied bbto bbthe bbgross bbcash bbamount
bband bbthe bbnet bbamount bbis bbthen bbused bbto bbbuy bbshares bbfor bbthe bbinvestor bbat
bbthe bbpredetermined bbprice. bb
However, bbthe bbinvestor bbis bbstill bbliable bbto bbincome bbtax bbat bbtheir bbmarginal bbrate
bbon bbthe bbgross bbdividend, bbwith bballowance bbfor bbthe bbDWT bbdeducted bbat
bbsource, bbas bbif bbhe bbor bbshe bbhad bbreceived bbthe bbcash bbdividend bbpayment. bb
A bbsimilar bbsystem bboperates bbin bbrespect bbof bbdividends bbreceived bbon bbmany
bbforeign bbshares. bbCurrently, bbhowever, bbthere bbis bbno bbwith-holding bbtax bbon bbUK
bbdividends. bb
Revenue bbplan bbto bbmove bbto bban bbindividualised bbDWT bbrate bbat bbsome bbstage,
bbwhich bbwill bbbe bbbased bbon bbeach bbinvestor's bbown bbtax bbrate. bbThis bbwill bbsee
bbhigher bbrate bbtaxpayers bbhaving bba bbDWT bbof bbcurrently bb40% bbwith bbstandard
, bbrate bbtaxpayers bbhaving bba bb20% bbrate bbapplied. bbNo bbdate bbhas bbyet bbbeen
bbconfirmed bbfor bbthe bbchange.
Gross bbDividend bbYield bb- bbAnswer bbGross bbannual bbdividend, bbdivided bbby bbcurrent
bbshare bbprice
Dividend bbCover bb- bbAnswer bbA bbratio bbthat bbmeasures bbthe bbpotential bbfor bbfuture
bbcapital bbgrowth bbof bbthe bbfirm. bbIt bbmeasures bbhow bbeasily bbthe bbdividend bbcan
bbbe bbpaid bb(or bb'covered') bbout bbof bbthe bbcurrent bbprofits bbof bbthe bbfirm. bbIt bbis
bbcalculated bbby bbdividing bbthe bbprofit bbaccruing bbto bbshareholders bbby bbthe bblevel
bbof bbdividends.
Earnings bbPer bbShare bb- bbAnswer bbNet bbincome bbof bba bbcompany bbdivided bbby bbthe
bbnumber bbof bbshares
The bbP/E bbRatio bb- bbAnswer bbPrice bbper bbshare bbdivided bbby bbearnings bbper bbshare
Net bbAsset bbValue bb- bbAnswer bbValue bbof bba bbcompany's bbnet bbassets bbdivided bbby
bbthe bbnumber bbof bbshares
Market bbCapitalisation bb- bbAnswer bbNumber bbof bbissued bbshares bbx bbcurrent bbshare
bbprice. bbRepresents bbthe bbtotal bbvalue bbof bba bbcompany.
EBITDA bb- bbAnswer bbEarnings bbbefore bbinterest, bbtaxes, bbdepreciation, bband
bbamortization
The bbfollowing bbcan bbreclaim bbfrom bbRevenue, bbDIRT bbalready bbdeducted bbfrom
bbdeposit bbinterest bbif bbthe bbdepositor bbis bbnot bbotherwise bbliable bbto bbincome bbtax
bbon bbthe bbinterest bb- bbAnswer bbA: bbCompanies. bbIf bbthe bbcompany bbis bbnot bbtaxable
bbon bbits bbprofits bband bbincome, bbfor bbexample, bbhas bbsubstantial bbtrading bblosses
bbwhich bbit bbcan bboffset bbagainst bbits bbincome, bbit bbcan bbreclaim bbany bbDIRT
bbsuffered bbon bbdeposit bbinterest bbearned, bbwhere bbit bbhad bbnot bbcompleted bba
bbdeclaration bbto bbobtain bba bbDIRT-free bbreturn. bb
B: bbIndividuals bb(or bbtheir bbspouse/civil bbpartner) bbwho bbare bbover bbage bb65 bband
bbwhose bbtotal bbincome bbwas bbless bbthan bbthe bbrelevant bbincome bbexemption bblimit
bbin bbthe bbyear. bb
C: bbIndividuals bbwho bbare bbpermanently bband bbtotally bbincapacitated bbas bba bbresult
bbof bbpersonal bbinjury bbcan bbreclaim bbDIRT bbarising bbfrom bbthe bbinvestment bbof
bbcompensation bbawards, bbwhere bbthe bbinvestment bbreturns bbare bbthe bbsole bbor
bbmain bbincome bb(that bbis, bbmore bbthan bb50%) bbof bbthe bbindividual. bbThis bbalso
bbextends bbto bbthe bbinvestment bbof bbcompensation bbawards bbfrom bbthe bbHepatitis bbC
bbTribunal. bb
D: bbIndividuals bbwho bbreceived bbcompensation bbawards bbfor bbthalidomide bbchildren
bbcan bbreclaim bbDIRT bbarising bbfrom bbthe bbinvestment bbof bbsuch bbawards.
Exemption bbfrom bbDIRT bb- bbAnswer bbNon-residents
