The Dividend Reinvestment Plan (DRIP) is a convenient, easy and cost effective way to build your shareholding by using your cash dividends to buy additional shares.
It allows shareholders of participating companies to use their cash dividends to buy more shares in their company. Rather than receiving a dividend cheque through the post or having their bank account credited with the dividend payment, shareholders in companies that operate a DRIP can choose to use their cash dividend to buy additional shares.
Whole shares are purchased with any residual money being carried forward and added to the next dividend. However, if the amount of the dividend, less any dealing costs incurred in completing the purchase, is insufficient to buy a single share no charge is made and the dividend is carried forward.
When you buy shares using a DRIP you will be sent
The exceptions to the above are where you are a CREST participant or hold your shares in a Corporate Sponsored Nominee, in these cases you will only receive a share purchase advice and a tax voucher. Where you do not have sufficient funds to purchase a full share you will receive a non-entitled advice and a tax voucher.
For the full terms and conditions and to apply for the DRIP, just select your company from the list detailed on the link below.
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The value of shares and the income, if any, from them can go down as well as up. Please remember that investments made under this agreement are in one company only and should therefore be considered as one part of a balanced portfolio.
