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Tax withholding for ETFs domiciled in France and Germany?

Posted: Wed Jan 13, 2021 2:59 am
by mursculio
Hi all!

I’m doing some research on European ETFs for a course I'm teaching. Here are some tricky questions I have not been able to resolve. I figured someone on this forum would have insight!

Question 1 - Everyone knows that Irish ETFs pay 15% tax on US source dividends and Luxembourg ETFs pay 30%. But what about German and French ETFs which invest in the US?

I know there are not many, but there are some I am looking at, and I have not been able to find a clear answer to this question.

For German ETFs the answer seems to depend on whether the fund is established as an “InvAG” (15%) or “KAG” (30%).

For France I have no idea – help?

Question 2 - What about 2nd-level taxation for German and French ETFs? If I am a non-resident receiving distributions from a German or French ETF, will tax be withheld on behalf of Germany and France, assuming no tax treaty is applied?

Any pointers or good source materials would be much appreciated. Thanks very much!

Re: Tax withholding for ETFs domiciled in France and Germany?

Posted: Thu Jan 28, 2021 3:51 pm
by Tellurius
Do you speak French or German?

Re: Tax withholding for ETFs domiciled in France and Germany?

Posted: Fri Jan 29, 2021 12:17 am
by rhe
mursculio wrote: Wed Jan 13, 2021 2:59 am Question 2 - What about 2nd-level taxation for German and French ETFs? If I am a non-resident receiving distributions from a German or French ETF, will tax be withheld on behalf of Germany and France, assuming no tax treaty is applied?
I looked into this a while back, and it looked like all German ETFs holding German stocks were paying some sort of tax, but some accumulating French (and Luxembourg domiciled) ETFs holding French stocks didn't seem to be paying any tax. I didn't ever find documentation on this, but rather inferred it by looking at the returns of the ETF relative to the underlying index.

(When you sell the accumulating ETF, of course, you would be liable for capital gains tax in your own country, but that may be very far in the future and you benefit from the compounding along the way)

Re: Tax withholding for ETFs domiciled in France and Germany?

Posted: Wed Feb 03, 2021 7:00 pm
by Ubersetzer
Taxes depend on where you reside. What is your country of residence?

Re: Tax withholding for ETFs domiciled in France and Germany?

Posted: Thu Feb 04, 2021 4:10 am
by TedSwippet
Ubersetzer wrote: Wed Feb 03, 2021 7:00 pm Taxes depend on where you reside. What is your country of residence?
Reductive and irrelevant. The topic author asked about taxes paid internally by an ETF to the country (or countries) of the assets it holds.