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Dividend & Interest

Transaction Form — DIVIDEND

Dividends and interest represent yield generated by your portfolio assets. They are cash payments received without selling the underlying asset.

🔑 Key Properties

Property Dividend Interest
Code DIVIDEND INTEREST
Cash effect ⬆️ Increases balance ⬆️ Increases balance
Asset effect — (quantity unchanged) — (principal unchanged)
Tax event Yes (taxable income) Yes (taxable income)

💡 When to Use

Use these transactions when cash arrives in your broker account as yield from an asset:

  • Dividend: Income from equity (stocks, distributing ETFs).
  • Interest: Income from fixed-income instruments (bonds, savings accounts, P2P loans, crowdfunding).

Do not use these for return of principal (e.g., bond maturity settlement).

💰 Dividends in Detail

Event vs Transaction

Concept Dividend Event Dividend Transaction
Scope Global — affects the asset price Personal — affects your portfolio
Example "Apple declared $0.25/share" "I received $12.50 from my 50 shares"
Recorded by Provider or manual (Data Editor) Broker report (BRIM import)
Chart impact Diamond marker (◆) on price chart Not visible on chart

Dividend Amount

The amount received depends on the number of shares held on the record date:

\[ \text{Dividend Received} = \text{Shares Held} \times \text{Dividend per Share} \]

Withholding Tax

Many jurisdictions apply withholding tax on dividends — especially for foreign stocks. The tax is deducted at source:

\[ \text{Net Dividend} = \text{Gross Dividend} \times (1 - \tau_{withholding}) \]

The withheld amount is typically recorded as a separate TAX transaction in LibreFolio, keeping the gross dividend and the tax deduction distinct for reporting purposes.

📈 Interest Sources

Source Description Frequency
Bond coupons Fixed or floating rate payments Semi-annual / Annual
Savings interest Interest on cash deposits Monthly / Quarterly
P2P loan payments Interest portion of loan repayments Monthly
Crowdfunding returns Fixed-rate returns on projects Varies

Theory & formulas

For the mathematics of interest accrual (simple vs compound, day count conventions, yield metrics), see:

  • 💰 Dividend Events — How dividends affect asset prices
  • 📈 Interest Events — Accrual and coupon mechanics
  • 🔬 FIFO Lot Analysis — How income is allocated pro-rata across open lots
  • 💰 Taxation — Tax treatment of yield
  • 🏛️ Bonds — The primary interest-bearing asset
  • 📈 Stocks — The primary dividend-paying asset class