With DRIP, dividends you receive will automatically be reinvested the next business day, back into the same investments you got them from.
Here’s what you need to know about DRIP with Hatch:
There are no fees for automatic dividend reinvestment.
You can turn dividend reinvestment on or off from Settings > Preferences.
Allow 1 business day for the change to be processed.
This setting will apply to all investments in your portfolio.
You can’t opt in or out for specific investments.
Reinvested dividends will be visible on the Transactions page.
When completed, you’ll see the dividend payment followed by an automatic buy order.
If a dividend cannot be reinvested (e.g. the stock is no longer available to buy on Hatch), then you’ll receive it as cash instead.
How are DRIP dividends taxed?
Just the same as any non-reinvested dividend you receive on Hatch:
Applicable US withholding tax will be deducted before the remaining amount is used to buy more shares.
Your dividend income, including when it was reinvested through DRIP, may need to be included in your NZ tax return.
DRIP transactions will show up in your Hatch tax reports as a dividend payment and a matching buy trade. Read more about Tax on dividends.