Incitec Pivot will return approximately $500 million in surplus capital to shareholders.

The capital return involves a $0.1557 per share equal capital reduction totalling $302.4 million and an unfranked special dividend of $0.1017 per share totalling $197.5 million.

No shares will be cancelled in the process, and the cost base of each share will be reduced by $0.1557 per share.

The company expects a class ruling by the Australian Taxation Office to address the Australian income tax implications of capital return.