SCHRODER MUTUAL FUNDS
2011 IMPORTANT TAX REPORTING INFORMATION
This letter contains important tax information specific to your investment in the Schroder Mutual Funds for use in preparing your 2011 tax return.
If you require further information, please call our Investor Services Representatives at (800) 464-3108.
In December 2010, the Tax Relief, Unemployment Insurance Reauthorization, and Job Creation Act of 2010 (the “Act”) was enacted. The Act
extends for two additional years (through 2012) the 15 percent maximum tax rate on long-term capital gains and qualified dividend income.
Qualified Dividend Income
Qualified Dividend Income (“QDI”) is taxed at the lower long-term capital gain rates. QDI is reported to you on Form 1099-DIV, Box 1b. The QDI
amount in box 1b will only apply if you have held the fund for more than 60 days during the 121-day period beginning 60 days before the fund’s exdividend date of the distribution. To assist you in determining whether you have met this holding period requirement, the ex-dividend date for the
applicable funds was December 9, 2011.
The reduced rate does not apply to bond funds. Please keep in mind that due to the beneficial tax rate changes affecting both qualifying dividends
and capital gains, you will need to complete the Qualified Dividends and Capital Gain Tax Worksheet in the Instructions for Form 1040 to compute
your taxes.
Important State Tax Information
United States Government Interest. Please check with your state or local tax office or your tax advisor to determine whether your state allows you
to exclude some or all of the income you earn from mutual funds that invest in direct U.S. government obligations. If so, multiply the income
percentage listed in the chart below by the amount in box 1a of your Form 1099-DIV to determine the amount of exempt interest. Due to certain
statutory limitations, shareholders of the funds listed in the table below that are residents of California, Connecticut or New York are not permitted to
exclude the portion of ordinary income that represents direct U.S. government obligations from their state income taxes.
FUND
International Alpha Fund
Emerging Market Equity Fund
U.S. Small and Mid Cap Opportunities Fund
Total Return Fixed Income Fund
Global Quality Fund
FUND
0.00%
0.00%
0.00%
6.13%
0.00%
International Multi-Cap Value Fund
U.S. Opportunities Fund
North American Equity Fund
Multi-Asset Growth Portfolio*
Absolute Return EMD and Currency Fund
0.00%
0.00%
0.00%
4.38%
0.00%
*Liquidated December 15, 2011
Corporate Dividends Received Deduction
A corporation is entitled to a special deduction from gross income for dividends received from a domestic corporation that is subject to U.S. income
tax. Listed below is the percentage of dividends received that qualifies for the corporate dividends received deduction for each of the respective
funds. This information is for use by corporations with a calendar tax year end.
FUND
Corporate Dividends Received Deduction Percentage
Emerging Market Equity Fund
North American Equity Fund
U.S. Small and Mid Cap Opportunities Fund
Multi-Asset Growth Portfolio*
Global Quality Fund
0.61%
100.00%
100.00%
3.01%
17.59%
Foreign Tax Credit and Foreign Source Income
The International Alpha, International Multi-Cap Value, Emerging Market Equity and Global Quality Funds qualified for, and elected to pass
through, foreign tax credits to their shareholders. Accordingly, you are entitled to claim either a foreign tax credit or take an itemized deduction on
your federal income tax return for your share of the taxes indicated in Box 6 of your 2011 Form 1099-DIV. Refer to IRS Publication 514, Foreign
Tax Credit for Individuals for additional information.
To be eligible to claim a foreign tax credit, you must have held your shares for more than 15 days within a 31day period. The 31-day period begins
15 days before the shares become ex-dividend. The ex-dividend date for those funds potentially impacted by this provision is December 9, 2011.
Thus the 31-day period began on November 24, 2011 and ended on December 24, 2011. If you are unable to use the foreign tax credit, you still may
be able to claim the amount as an itemized deduction.
The enclosed is furnished for information purposes only. Please consult your tax advisor for assistance regarding your specific tax situation.
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