Tax Preference: When a shareholder gets some deductions against payment of taxes for share it is termed as tax preference. A shareholder receives tax preference only in long-term.
Share repurchase: Share repurchase is the situation when a corporation purchases back its own shares because the company noticed that the shares are undervalued. This decline the number of shares left and enhances the value of the shares of the corporation. The share repurchases increase the corporation’s earnings for a share.
Dividend: The amount that shareholders receive in return of their investment is called a dividend. The dividend is paid according to the number of share of each shareholder. Preference shareholder receives a fixed rate of dividend but equity shareholders collect dividend only when there is a profit in the company.
To determine:
The conditions when investors will have a tax
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