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When are investment gains added to my account balance?

An outline of how investment gains and dividends apply to your Moneybox account.

Zunera avatar
Written by Zunera
Updated over a week ago

It’s important to know that the main part of any investment gain or loss comes from the change in the market value of the assets themselves. This is the biggest contributor to your investment's performance. The value of these assets rises and falls from day to day based on market movements, and this fluctuation is reflected in your overall balance.

Most dividends or investment gains from the tracker funds and ETFs that Moneybox offers investment into are automatically reinvested into the funds, producing more income. These are known in the investment industry as ‘accumulation’ funds (rather than ‘income’ funds, where any gains made by the fund will be paid out to you).

As such, these gains are taken into account when your daily performance figure is calculated, so they don’t show in your ‘Activity’ in the Wealth tab or on your account statement. When this reinvestment occurs, your total number of units remains the same. However, the value of each unit increases, which is then reflected in your overall balance.

In terms of when and how frequently dividends are paid out, this is determined by the fund manager (BlackRock, Legal & General, Fidelity, Vanguard, Royal London, HSBC, and Old Mutual) and their timing. Generally speaking, funds that pay dividends do so on a quarterly, biannual, or annual basis.

We currently offer two ‘income’ ETFs, such as the Global Clean Energy ETF and the S&P 500 ESG ETF, both of which pay out bi-annual dividends as cash to investors.

However, due to operational limitations, we’re currently unable to pay this into ‘Available Cash’. Instead, we reinvest any dividends received from 'income' funds back into the same fund for you.

For the US stocks that pay dividends, any dividends earned will be paid into Available Cash. This can either be reinvested or withdrawn to the linked bank account in the app by heading to Settings > Withdraw.

Please note that dividends do not count towards the annual ISA allowance. However, they are subject to tax by the IRS at a 15% rate, which takes place before they’re paid out to Available Cash, and this can increase to a 30% if the W-8BEN form has expired. We notify our customers in advance before their W-8BEN form expires.

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