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HUNDREDS of thousands of shareholders in Vodafone who originally invested in the public flotation of Eircom (formerly Telecom Eireann) 15 years ago will avoid a tax bill when they share a windfall of at least €27.5m.

Revenue has confirmed that those original investors will not get a bill for capital gains tax when Vodafone's US business is sold off as proposed next month.

The reason is that small-time investors are still operating at a loss on their Telecom investment, a portion of which eventually became Vodafone stock through a sell-off.

A briefing document published by the Revenue Commissioners outlines the implications of Vodafone deciding to sell its 45pc stake in the US business Verizon Wireless to Verizon Communications Inc.

Almost 400,000 Irish investors, who directly hold shares in Vodafone, will have received correspondence outlining its so-called "return to value strategy".

Vodafone is set to distribute almost €62bn back to its shareholders in a mixture of cash and Verizon shares.

Taking the value of December 6 as a guide, shareholders would be entitled to €0.89 in Verizon shares and €0.36 in cash for each Vodafone share.

Having analysed the figures, which they say are provisional, the Revenue Commissioners said there would be no chargeable gain – and therefore no capital gains tax payable by those former Eircom shareholders who take the windfall as capital.