Dividends

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avbferry
Posts: 74
Joined: Tue Jan 03, 2012 9:09 am

Dividends

Postby avbferry » Tue Jul 02, 2013 9:24 am

Hi all,

Recently got paid dividends and was subject to a 30% tax (I am a non-US resident). I noted that my broker has this dividend reinvestment program ("If you are not enrolled in the Dividend Reinvestment Program, the amount shown below has been credited to your account.")

Does it mean that if I enrol into the program, I can avoid the 30% tax?

Thanks!

KyleAAA
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Re: Dividends

Postby KyleAAA » Tue Jul 02, 2013 9:27 am

Totally depends on the tax laws where you live. In the US, this would NOT exempt you from tax.

avbferry
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Re: Dividends

Postby avbferry » Tue Jul 02, 2013 9:31 am

KyleAAA wrote:Totally depends on the tax laws where you live. In the US, this would NOT exempt you from tax.


My country does not have a treaty with the US. What are the implications?

KyleAAA
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Re: Dividends

Postby KyleAAA » Tue Jul 02, 2013 11:11 am

avbferry wrote:
KyleAAA wrote:Totally depends on the tax laws where you live. In the US, this would NOT exempt you from tax.


My country does not have a treaty with the US. What are the implications?


I don't understand. Where do you live, what country are you a citizen of, what country are the investments in, and who exactly is withholding the 30% tax?

avbferry
Posts: 74
Joined: Tue Jan 03, 2012 9:09 am

Re: Dividends

Postby avbferry » Wed Jul 03, 2013 11:08 am

KyleAAA wrote:
I don't understand. Where do you live, what country are you a citizen of, what country are the investments in, and who exactly is withholding the 30% tax?


Apologies of the lack of details.

I live in Singapore. Am a resident there. I invest in Vanguard Total World Stock Idx Fd (ETF). The US witholds that 30% tax.

Would greatly appreciate your help on this.

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CABob
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Re: Dividends

Postby CABob » Wed Jul 03, 2013 12:04 pm

I live in Singapore. Am a resident there. I invest in Vanguard Total World Stock Idx Fd (ETF). The US witholds that 30% tax.
So I assume from your post that you are a US citizen, correct?
Bob

KyleAAA
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Re: Dividends

Postby KyleAAA » Wed Jul 03, 2013 12:15 pm

avbferry wrote:
KyleAAA wrote:
I don't understand. Where do you live, what country are you a citizen of, what country are the investments in, and who exactly is withholding the 30% tax?


Apologies of the lack of details.

I live in Singapore. Am a resident there. I invest in Vanguard Total World Stock Idx Fd (ETF). The US witholds that 30% tax.

Would greatly appreciate your help on this.


Reinvesting dividends would have no tax consequences in the US. You have to pay the tax regardless.

cjking
Posts: 1592
Joined: Mon Jun 30, 2008 4:30 am

Re: Dividends

Postby cjking » Wed Jul 03, 2013 1:54 pm

My wife (a non-US citizen living in UK) holds some US shares with a US broker and had 30% tax imposed (in place of the previous 15% withholding tax) because she was too lazy to fill in a W-8BEN form her broker sent her. I believe she could reclaim the extra 15% by filling in a US tax return. I don't know if this is info. is applicable to your situation.

avbferry
Posts: 74
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Re: Dividends

Postby avbferry » Fri Jul 05, 2013 9:41 pm

CABob wrote:
I live in Singapore. Am a resident there. I invest in Vanguard Total World Stock Idx Fd (ETF). The US witholds that 30% tax.
So I assume from your post that you are a US citizen, correct?


Yes, that is correct.

plats
Posts: 358
Joined: Mon Dec 31, 2007 9:46 pm

Re: Dividends

Postby plats » Sat Jul 06, 2013 1:59 pm

USA brokerages and banks don’t have to withhold the 30% if they receive a letter stating that you are a US citizen and file a tax return in the USA. It’s been decades since I’ve had to do this so I’m not up-to-date with current regulations.


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