Strategy Preferred Shares STRC Launch on UK Platform, Investors May Face Double Taxation

Gate News update: On March 31, Strategy’s preferred stock STRC listed on the UK trading platform Trading 212 on March 30, with an annualized yield of about 11.5%. However, UK investors holding STRC directly may face pressure from higher taxes. In the United States, STRC’s monthly distributions are classified as return of capital (ROC), so no tax is required; but UK brokers typically categorize it as foreign dividends, which are subject to income tax at the marginal dividend tax rates. For basic-rate taxpayers, the rate is 8.75%, while for high-income individuals it can be as high as 39.35%. When sold, investors also need to pay additional capital gains tax (CGT), so the estimated actual net yield is only about 10%. Crypto analyst James Van Straten recommends that UK investors instead consider the 21Shares Strategy Yield ETP, listed on Euronext Amsterdam and Paris. The product has a management fee of zero, uses an accumulating structure, and its returns are automatically reinvested rather than paid out in cash. When sold, it typically only requires CGT and no income tax burden, making its tax efficiency significantly better.