What is a contract note?
A contract note is a document that summarises a completed transaction in securities. It serves as a receipt and as a basis for your own follow-up, but also for bookkeeping and later taxation.
The note is normally sent by your bank or broker and shows the key details of the transaction. Once you understand what it contains, it becomes easier to follow up on your trading and spot discrepancies in time.
How to read a contract note
A contract note usually contains the same key details whether you buy or sell. The most important thing is to be able to see quickly that the transaction has been recorded correctly and that the costs match your expectations.
- Which security was traded and the quantity
- Price per unit and total amount
- Brokerage fee (courtage) and any other fees
- Settlement date and which account is debited or credited
- Trade date and how the transaction was executed
When you check these points, you get a reliable picture that the transaction is correct. It also gives you better control over your actual return over time.
What you should check on a contract note
Worth bearing in mind
A contract note is your most important check after a transaction, especially if you trade larger amounts or make several transactions close together. It is easy to miss details that affect the actual result, such as the brokerage fee, currency exchange or how the price was calculated.
Always go through the note straight away and compare it with your order or agreement. If something looks wrong, it is easier to sort out while the transaction is fresh and before bookkeeping or tax return documentation has been built on it.
Frequently asked questions
What is a contract note used for?
It is used as confirmation that a transaction has been completed and shows the transaction's terms, costs and timing.
Do I have to keep my contract notes?
Yes, it is wise to. They may be needed for your tax return, to check your holdings or if you need to confirm the details of a transaction afterwards.
What happens if something in the note is wrong?
Contact the broker or platform directly. An error needs to be corrected so that the right information is recorded.
Do I always receive a contract note when trading?
Yes, both when buying and when selling. In digital trading it is sent automatically, whereas in unlisted transactions it is often issued manually.
Does a contract note always include the brokerage fee?
Yes, if the transaction includes a brokerage fee, it should be shown. If the brokerage fee is zero, it is normally shown as 0.