Since it hit me again today and I had again countless postings on my clearing accounts ( 96😂)
It is in the year 2022
And you are happy about your investment in one or more Reit(s). Dividends are diligently trickling into your clearing account every month. You are the king of dividends.
A few months later. Shock STORNO on the clearing account. All dividends gone! What happened? The clearing account in the minus -> panic? No.
Why are dividends cancelled?
The negative dividend posting is related to the so-called reclassification. In simple terms, a recalculation of the dividend takes place because it is not announced until the beginning of the following fiscal year how the dividends paid are divided for tax purposes. (Since this information is not available until the following year, the recalculation or reclassification does not take place until then.
So the company has to reallocate the money from dividends and capital returns, so to speak, after the close of the fiscal year. (For Canadian and US companies, this usually takes place annually).
The correction of the dividends is done as a "delta correction" and has no influence on the annual tax certificate of the previous year. Although dividends from the previous year may be affected by the measure. This may result in a tax disadvantage depending on the use of the personal allowance.
When will the corrected dividends be credited?
Normally, a few days after the cancellation, the dividend is paid again in a recalculated amount. This can result in several postings, as each payment made is corrected individually. In the example with me today within a few hours.
Where can I find information on tax recalculation?
On the websites of the companies you can usually find information about the recalculation in the Investor Relations section or under Dividends. Just have a look at the IR page of the riding of your choice.
Dividend cancellation and tax allowance
Regarding the personal tax allowance, there may be disadvantages. For example, if the tax-free allowance was used in the previous year, but has already been used up in the following year, the regular taxes will apply. (The tax-free amount used in the previous year could therefore be reduced retroactively).
Depending on the constellation, it is therefore possible that this chargeback means that part of the tax allowance was not used retroactively in the previous year and the tax allowance for the current year is used up, even though the payment was actually made in the previous year. What does @DerSteuerberater about this?
Do I have to take action?
As a rule, you do not need to take any further action. The broker takes care that everything is tax compliant.
PS thanks to Lisa
Source:
You don't have to know everything but only where it is written.
Have a nice weekend ✅
