I have a doubt regarding dividend reinvestment plans (so-called DRIPs), the Pie System in Trading212, and Taxes.
I’ve searched a little bit in the forum but I haven’t seen an answer (used mainly “DRIP” as the keyword so), sorry if this question was already answered and I didn’t see…
On to the point: I’m starting investing in Stocks and reading some information, and I read about the benefits of DRIP, and that “capital gains from shares held in a DRIP are not calculated and taxed until the stock is finally sold, usually several years down the road” - source.
As it is obvious, if we’re playing the long run, by paying taxes in the end, we have a “stronger” compound effect during the period we hold the stock.
My question is, having the “Auto Reinvest” option set in the Pie, do I have to declare those dividend earnings in the end of each year or not?
Let me know if I wasn’t clear. Thank you very much.