Tax Information
2007 Canadian Tax Information
The information provided below is solely to assist Canadian individual unitholders with tax reporting information in respect of distributions declared during the calendar year 2007. This information is not intended to constitute legal or tax advice to any holder or potential holder of Eveready units (“Units”). Canadian unitholders should consult with a taxation or investment professional for additional tax advice. The following summary applies to unitholders who are residents of Canada under the Income Tax Act (Canada) and who hold their units as capital property.
Units held within an RRSP, RRIF, RESP or DPSP
No amounts are to be reported on the unitholders’ 2007 Income Tax Return where Units are held within a Registered Retirement Savings Plan (RRSP), Registered Retirement Income Fund (RRIF), Registered Education Savings Plan (RESP) or a Deferred Profit Sharing Plan (DPSP).
Units held outside an RRSP, RRIF, RESP or DPSP
Unitholders who hold their Units outside of an RRSP, RRIF, RESP or DPSP and were entitled to receive distributions on a distribution record date within the calendar year 2007 will receive a T3 Statement of Trust Income Allocations and Designations Slip (“T3”) directly from Computershare Investor Services or from the broker/intermediary who the unitholder holds their Units through. Distributions declared in 2007 will be 100% taxable as “Other Income” and reported in box 26 of the T3. The amount reported in box 26 “Other Income” on the T3 should be reported on the unitholders’ 2007 Income Tax Return. The deadline for mailing the 2007 T3’s to unitholders, as required by the Canada Revenue Agency is March 30, 2008.
Schedule of Tax Treatment of 2007 Distributions
The following schedule details the cash distributions declared in 2007 and the tax treatment of each distribution per Unit for income tax purposes:
|
Record Date
|
Payment Date
|
Taxable Amount (T3 – Box 26)
|
Return of Capital (T3 – Box 42)
|
Total Distribution
|
|---|---|---|---|---|
| January 31, 2007 | February 15, 2007 | 0.06 | 0.00 | 0.06 |
| February 28, 2007 | March 15, 2007 | 0.06 | 0.00 | 0.06 |
| March 30, 2007 | April 16, 2007 | 0.06 | 0.00 | 0.06 |
| April 30, 2007 | May 15, 2007 | 0.06 | 0.00 | 0.06 |
| May 31, 2007 | June 15, 2007 | 0.06 | 0.00 | 0.06 |
| June 29, 2007 | July 16, 2007 | 0.06 | 0.00 | 0.06 |
| July 31, 2007 | August 15, 2007 | 0.06 | 0.00 | 0.06 |
| August 31, 2007 | September 17, 2007 | 0.06 | 0.00 | 0.06 |
| September 28, 2007 | October 15, 2007 | 0.06 | 0.00 | 0.06 |
| October 31, 2007 | November 15, 2007 | 0.06 | 0.00 | 0.06 |
| November 30, 2007 | December 14, 2007 | 0.06 | 0.00 | 0.06 |
| December 29, 2007 | January 15, 2008 | 0.06 | 0.00 | 0.06 |
| Total | 0.72 | 0.00 | 0.72 | |
Adjusted cost base of Units for capital gain purposes
Since there is no return of capital component for 2007, the distributions will have no effect on the adjusted cost base of the Units.
United States Tax Information
Eveready believes for U.S. federal income tax purposes, that the Units of Eveready more likely than not will be properly classified as equity in a corporation, rather than as debt. Eveready believes that the cash distributions declared in 2007, out of its current and accumulated earnings and profits, to individual U.S. unitholders, will more likely than not be treated as qualified dividend income for U.S. federal income tax purposes and eligible for the reduced maximum rate of tax to individuals of generally 15%.
U.S. unitholders are advised to consult their own tax advisors as to the specific U.S. federal and state income tax consequences of having received a cash distribution in 2007 from Eveready. The preceding information is provided to assist individual U.S. resident unitholders in reporting 2007 Eveready distributions received on their Internal Revenue Service Form 1040, "U.S. Individual Income Tax Return" ("Form 1040"). This summary is of a general nature and is not intended to constitute legal or tax advice to any particular holder or potential holder of Eveready Units. Readers should consult with their legal or tax advisors as to their particular tax consequences of holding Eveready Units.