Aberdeen Asian fund to shift to UK investment trust status

The company says the move is to benefit from a number of double taxation treaties between the UK and jurisdictions in which the company invests in. 

The fund is also planning to change its name from 1 January to ‘abrdn Asian Income Fund Limited’ to reflect the parent company’s new brand.

The fund’s aim is to provide investors with a total return by investing mainly in Asia Pacific securities, including those with an above average yield.

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The fund currently earns investment income from a diversified portfolio of investments with exposure to the Asia Pacific region, much of it subject to overseas withholding taxes. 

After taking tax mitigation advice, the board of the fund believes that a UK tax resident company will be able to access lower rates of withholding tax in some jurisdictions than a Jersey tax resident company as there are a greater number of double tax treaty agreements between the UK and overseas jurisdictions. 

It is only the tax residency of the company that the board proposes to move to the UK at this time. The company will remain a Jersey incorporated entity, subject to Jersey law and regulation. 

In order to make the change the company plans new articles of association to remove restrictions on the company carrying out its business in the UK.   

The company also announced interim results for the half year to 30 June. During this period the company’s net asset value return over the six months to 30 June 2021 was 6.9% compared to the MSCI AC Asia Pacific ex Japan High Dividend Yield Index return of 7.5% and the MSCI AC Asia Pacific ex Japan Index return of 5.8%.

Two dividend payments totalling 4.5p will be distributed to shareholders.

Charles Clarke, chairman, Aberdeen Asian Income Fund, said the fund had performed well on an “absolute basis” but Covid-19 remained a major challenge in recent months for many Asia Pacific economies.

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