How are dividend payments made?

[MrMarcus]

I have just started trading and am interested to know: how exactly do companies pay dividends to you?

Does your broker forward your bank account details to the company and they credit your account? Do they send you a cheque in the mail? Do they automatically re-invest the money in an equivalent number of additional shares?

Some companies have sent me forms in the mail where I can select how my dividends will be paid. If I don't specify a particular way, what is the default method?

 

[IOT]

I'm a bit of a noob (only had 1 divvie so far but due for some more soon) but I believe the answer is all of the above with the default as you say a cheque in the mail. At least that was my experience.

 

[rozella]

Yes default is by cheque.

If you intend to collect dividends often, then it is best to register your method of payment & TFN yourself with the applicable registry so that you are in control of the matter.

The main registries are http://www.computershare.com.au & http://www.linkmarketservices.com.au