Author Topic: Loyal3 and Dividends  (Read 3809 times)

mrgrump

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Loyal3 and Dividends
« on: May 21, 2014, 03:01:46 AM »
On April 14th I purchased .0919 ($10) of a share in Budweiser InBev (BUD) on Loyal3 among some other purchases. I know it's peanuts but it's part of my own social experiment of sorts. However, now I am a little confused.

I logged on today and was happy to see I had $0.14 in dividends from BUD deposited into my account. The math behind the dividend seems strait forward; $1.47 cash dividend x 0.0919 shares for a total of $0.14 (rounded up). However everything else I can find shows a bud dividend of $1.99984 which even with my small position would mean a dividend of $0.18.

4 cents is nothing to get mad about but with a substantially larger holding those pennies could add up real fast. Can anyone explain the missing 4 cents or different dividend?

Cyrano

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Re: Loyal3 and Dividends
« Reply #1 on: May 21, 2014, 05:15:23 AM »
Belgium taxes dividend payments at 25%. Expect the missing 0.04 to show up on your Loyal3 1099 under "foreign taxes paid".

wtjbatman

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Re: Loyal3 and Dividends
« Reply #2 on: May 21, 2014, 05:32:59 AM »
Good thing you've only invested $10 with them. Make sure that before you make any large investments in other dividend paying companies, you do further research so you understand things like tax withholding's on foreign companies.

mrgrump

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Re: Loyal3 and Dividends
« Reply #3 on: May 21, 2014, 06:16:50 AM »
Thanks Cyrano! It now makes sense.

Batman - based off your comment you seem very anti-BUD or at least anti- foreign company dividends, other than taxes is there a reason for this?

arebelspy

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Re: Loyal3 and Dividends
« Reply #4 on: May 21, 2014, 07:19:51 AM »
Batman - based off your comment you seem very anti-BUD or at least anti- foreign company dividends, other than taxes is there a reason for this?

I read the comment not as anti- either of those, but pro knowing what you're investing in.  :)
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wtjbatman

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Re: Loyal3 and Dividends
« Reply #5 on: May 21, 2014, 08:35:16 AM »
ARS hit it on the head. I have nothing against foreign companies in general or BUD in particular, just pointing out that you (or anyone reading this) need to be more careful when investing in individual companies than you would be investing in an index fund. You weren't the first person and you won't be the last who bought shares of a foreign company without realizing a large percentage of dividends may be withheld for tax reasons.

If you want to invest in foreign dividend stocks, I would suggest looking at companies in a country like the U.K., where they don't withhold taxes on foreign payouts.

mrgrump

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Re: Loyal3 and Dividends
« Reply #6 on: May 21, 2014, 11:33:06 AM »
Batman - I appreciate the advice and couldn't agree more as 90+% of my investments are in index funds. I didn't realize that some foreign countries with-held taxes when the dividend was paid. You and Cyrano set me straight. I still have a lot to learn.

The intent of my question was to learn if you had any other objections to foreign stocks. I checked out the "Dividend Cave." If that's your site you have a lot of interesting content that I need to read.

If you want to learn more about why I purchased BUD check it out here at http://grumpyandannoyed.com/junk-food-experiment/

Thanks.