Personal Finance: A little bit on the side

You shouldn't let them affect your choice of investment but shareholder perks can be well worth having, says Harvey Jones

THE REWARDS of share ownership are not restricted to capital growth and dividend income. They can also be measured in discounted pizzas, holidays and alcohol.

Growing numbers of companies are rewarding investors with a range of perks, usually in the form of discounts on their products or services. The aim is to foster a closer bond with the company than would come from simply watching share movements, and to encourage people to invest in return for a freebie or two.

Last year's pounds 1.3bn Thomson Travel Group flotation highlighted the attraction of share perks. The offer of a 10 per cent reduction for shareholders on the price of all Thomson and Skytours holidays triggered a stampede of investors.

However, the share price has fallen 20 per cent since the float, which highlights the golden rule of investing for perks: they have their charms but should be seen as a bonus, and should not sway your decision to invest.

Investors in Forte Posthouse have been lucky. Many were seeking discounts on hotel accommodation, but saw shares rise after a takeover by Granada Group. Granada now offers investors with a minimum of 80 ordinary shares up to 12.5 per cent discounts on Forte Posthouse and Forte Heritage, Le Meridian, Travelodge Hotels and Little Chef restaurants.

Elissa Bayer, head of private clients at the London office of the stockbrokers Greig Middleton, says the most popular perk is offered by P&O. Shareholders receive a 50 per cent discount on Dover to Calais ferry crossings, with lesser discounts on other crossings, if they hold a minimum of pounds 600 in P&O concessionary stock. Hold pounds 300 in stock and these discounts are halved. The other highly cherished investment for perk seekers are Wimbledon debentures, which can cost up to pounds 30,000 but offer the reward of one centre court ticket a day during Wimbledon fortnight.

Ms Bayer stresses that share perks are not automatically given out. In many cases you have to apply for them and many of her clients do not bother, she says.

A booklet setting out attractive perks for UK shareholders is available from Hargreaves Lansdown Asset Management. Peter Hargreaves says that although they should only be seen as a bonus, some perks can add value to an investment and may be worth taking into account.

"I think they can be quite useful, and they are also tax free. For example, Whitbread's book of vouchers is worth around pounds 50 a year. With a pounds 50 dividend on pounds 1,000 of shares, you are looking at a 10 per cent yield."

Some companies will not offer perks if you hold their shares in a nominee account (when your shares are held by your stockbroker) or if you keep them in a PEP.

When considering perk options, you must also check the minimum holding required to claim and that you are buying the right type of share. You may also have to hold the share for a set period, often 12 months.

Some companies, including Iceland, Airtours, Ladbroke Group and Whitbread, offer discounts to all shareholders. Ladbroke discounts include 10 per cent off rooms, food and drink in Hilton UK and overseas hotels, with 20 per cent discounts on published Leisure Weekend prices.

Airtours offers 10 per cent off holidays for shareholders, with one free bottle of champagne per booking on the holiday flight. Iceland offers 10 per cent discount vouchers on groceries.

You will need to hold 1,250 ordinary shares for a minimum of six months to get a 10 per cent discount at Moss Bros, 600 ordinary shares for a 10 per cent discount at Thistle Hotels, and 500 ordinary shares for a 20 per cent discount on weekday meals at Harry Ramsden's.

One discount that may appeal to many is a pounds 1 discount on any purchases costing more than pounds 5 (excluding medicines and gift vouchers) from Boots if you have more than 100 ordinary shares. People with more than 200 ordinary shares in British Airways will get 10 per cent off published fares.

Jonathan Fry, joint managing director with Premier Asset Management, which also publishes a perks guide, says perks may be worth a look if you are a regular user of a particular service or product. Regular shoppers at Next, for example, may benefit from a 25 per cent discount at stores, although 500 shares are needed - which would set you back almost pounds 2,800.

Mr Fry picks out Barratt Developments as a good perk deal: hold 1,000 shares for 12 months and you get pounds 500 off every pounds 25,000 you spend on one of its properties. McCarthy & Stone offers a pounds 1,000 discount per property if you hold 500 ordinary shares for 12 months before purchase.

He says Tottenham Hotspur, which offers shareholders a 10 per cent discount at Spurs Superstores, may be a good all-round investment now that George Graham has been appointed manager.

The trend is for companies to offer a percentage off purchases, rather than cash vouchers. "After all, they are not giving perks because they love you but because they want to encourage you to do business with them," Mr Fry says.

'Independent on Sunday' readers can get a free copy of 'Attractive Perks for UK Shareholders', usual price pounds 3, from Hargreaves Lansdown, by phoning 0800 850 661.

Premier Asset Management is also offering a copy of its guide to perks worth pounds 2.50 free to the first 100 'Independent on Sunday' readers to phone 0800 212577.

Start your day with The Independent, sign up for daily news emails
Arts and Entertainment
Ben Stiller as Derek Zoolander in the leaked trailer for Zoolander 2
film
Sport
footballArsenal take the Community Shield thanks to a sensational strike from Alex Oxlade-Chamberlain
Arts and Entertainment
Gemma Chan as synth Anita in Humans
film
News
Keeping it friendly: Tom Cruise on ‘The Daily Show’ with Jon Stewart
people
Arts and Entertainment
Ensemble cast: Jamie McCartney with ‘The Great Wall of Vagina’
artBritish artist Jamie McCartney explains a work that is designed to put women's minds at rest
News
Republican Presidential Candidate Donald Trump
people
ebooks
ebooksAn introduction to the ground rules of British democracy
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
SPONSORED FEATURES
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

Recruitment Genius: DBA Developer - SQL Server

£30000 - £35000 per annum: Recruitment Genius: This is an exciting opportunity...

Recruitment Genius: Customer Service Administrator

£13000 - £15000 per annum: Recruitment Genius: Are you passionate about custom...

Recruitment Genius: Dialler Administrator

£22000 - £25000 per annum: Recruitment Genius: Main purpose: Under the directi...

Ashdown Group: Contracts Manager - City of London

£35000 - £37000 per annum + benefits : Ashdown Group: Contracts Manager - City...

Day In a Page

Turkey-Kurdish conflict: Obama's deal with Ankara is a betrayal of Syrian Kurds and may not even weaken Isis

US betrayal of old ally brings limited reward

Since the accord, the Turks have only waged war on Kurds while no US bomber has used Incirlik airbase, says Patrick Cockburn
VIPs gather for opening of second Suez Canal - but doubts linger over security

'A gift from Egypt to the rest of the world'

VIPs gather for opening of second Suez Canal - but is it really needed?
Jeremy Corbyn dresses abysmally. That's a great thing because it's genuine

Jeremy Corbyn dresses abysmally. That's a great thing because it's genuine

Fashion editor, Alexander Fury, applauds a man who clearly has more important things on his mind
The male menopause and intimations of mortality

Aches, pains and an inkling of mortality

So the male menopause is real, they say, but what would the Victorians, 'old' at 30, think of that, asks DJ Taylor
Man Booker Prize 2015: Anna Smaill - How can I possibly be on the list with these writers I have idolised?

'How can I possibly be on the list with these writers I have idolised?'

Man Booker Prize nominee Anna Smaill on the rise of Kiwi lit
Bettany Hughes interview: The historian on how Socrates would have solved Greece's problems

Bettany Hughes interview

The historian on how Socrates would have solved Greece's problems
Art of the state: Pyongyang propaganda posters to be exhibited in China

Art of the state

Pyongyang propaganda posters to be exhibited in China
Mildreds and Vanilla Black have given vegetarian food a makeover in new cookbooks

Vegetarian food gets a makeover

Long-time vegetarian Holly Williams tries to recreate some of the inventive recipes in Mildreds and Vanilla Black's new cookbooks
The haunting of Shirley Jackson: Was the gothic author's life really as bleak as her fiction?

The haunting of Shirley Jackson

Was the gothic author's life really as bleak as her fiction?
Bill Granger recipes: Heading off on holiday? Try out our chef's seaside-inspired dishes...

Bill Granger's seaside-inspired recipes

These dishes are so easy to make, our chef is almost embarrassed to call them recipes
Ashes 2015: Tourists are limp, leaderless and distinctly UnAustralian

Tourists are limp, leaderless and distinctly UnAustralian

A woefully out-of-form Michael Clarke embodies his team's fragile Ashes campaign, says Michael Calvin
Blairites be warned, this could be the moment Labour turns into Syriza

Andrew Grice: Inside Westminster

Blairites be warned, this could be the moment Labour turns into Syriza
HMS Victory: The mystery of Britain's worst naval disaster is finally solved - 271 years later

The mystery of Britain's worst naval disaster is finally solved - 271 years later

Exclusive: David Keys reveals the research that finally explains why HMS Victory went down with the loss of 1,100 lives
Survivors of the Nagasaki atomic bomb attack: Japan must not abandon its post-war pacifism

'I saw people so injured you couldn't tell if they were dead or alive'

Nagasaki survivors on why Japan must not abandon its post-war pacifism
Jon Stewart: The voice of Democrats who felt Obama had failed to deliver on his 'Yes We Can' slogan, and the voter he tried hardest to keep onside

The voter Obama tried hardest to keep onside

Outgoing The Daily Show host, Jon Stewart, became the voice of Democrats who felt the President had failed to deliver on his ‘Yes We Can’ slogan. Tim Walker charts the ups and downs of their 10-year relationship on screen