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That did make me LOL.
What makes it even more incomprehensible is that the US tax incurred is offsetable in UK tax returns so ultimately makes no difference anyway and is a storm in an (uninformed) teacup. Such is life.
Reading this talk about dividend taxes over and over again from those who have failed to do their due diligence properly is almost enough to make me sell up and move on.
But then I see that December 2022 Henry hub price at 4.40
Thronegames
That's no fair you got your answer in before me ONLY because I was typing all those
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No fair.
(Stamping feet and stabbing wife...............................................................................
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..............................................................................................................................are you happy)
PS I am divorced
adv11
"will this topic ever go away ?"
...................let me think about it ............................................................................
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NO
Never
Ever
adv11, this topic will never go away as long as new shareholders join the message board and find that they've been taxed / over-taxed on their dividend!
And how do you suggest DEC change US/UK Govt tax policies?
Your naivety is astounding.
There is one fix - DEC shareholders use competent brokers. Simples.
will this topic ever go away ?
Is it going to drag down this board until someone fixes it ?
DEC - over to you, no one else is going to find a solution.
Nova - you're not quite correct.
Worst case with a broker who can't / won't handle US tax correctly is 30% witholding tax, even in an ISA.
A competent broker with a completed W8 form will reduce this to 15% for an ISA and 0% for a SIPP.
The variation in answers is due to the variation in broker performance.
The divi will always be taxed in an ISA. At 15% with W8BEN.
Interactive Investor handle the divi without problems.
Thanks for all your replies.
My understanding was that because DEC is an US based company, when they issue the divi, then they deduct the tax @30%. In others, it is taxed at the source/company. Filling the W8 forms allows us 15% reduction due to the tax agreement between our countries. That is why I assumed even if it is in an ISA, the divi has already been taxed even before it reaches out accounts.
But based on the comments, it seems some brokers may even be able to pay you full amount because they sort the tax out from their end if it is held in an ISA? Not sure how true this is because like I said, it has already been taxed before the divi is paid out. At least worst case is if DEC is paying a 10% yield, then the minimum payout would be 8.5%. but I'm sure we would al preferred the full 10%! Thanks all.
Banks take a cut of dividend payments, I was using barclays smart investor and they where £6 to buy and sell
Thanks.
iWeb is owned by Halifax Bank (UK). Basic functionality, basic web layout, simple but works for me. Have only S&S ISA with them as I'm more long term focused for dividends.
Charges: £100 one time off charge when opening account, no annual fee, £5 buying/selling commission.
I'm using other platforms for all research, news and portfolio performance.
Had this account for couple of years now. Never had any issues, till now with DEC div tax.
Can recommend if you have "buy and forget" approach, but not when want to trade regularly.
Trading212 isa the W8ben is automatic when you sign up with them, I've never used iweb is it any good ?
That's what I though. Then got 30% tax and iWeb told me they can't do anything about it cause it was paid by Crimson and Crimson not accepting W8BEN.
Which broker for ISA you use?
It is quite confusing you have one site saying one thing and another saying different but from what I can understand is you won't get taxed on an dividend that is listed in the UK if it goes in an isa
My previous dividend payment with Dec was full amount and I didn't see no 15 or 30% reduction
Shannonlaw93 - People who are taxed, are talking about dividends from US companies. Even if your shares are in ISA, they are still taxed by US, question is how much? Full 30% or reduced 15%.
iWeb stated that on their platform, US companies listed in UK are taxed at 30% even with W8BEN form filled, cause of whatever system they are using. WebChat operator used a name Crimson when he told me about it, but I don't know what that is.
Why are people being taxed for dividends ? I've got mine going into an isa and haven't been taxed once it seems to be an on going topic anything outside an isa is taxed just switch over
Can confirm what JonnyGee said about brokers. I'm using ISA from iWeb and even with W8BEN form filled they still deducted 30% tax from DEC div. Need to check options of moving shares to different broker to avoid that as it will be substantial amount of money in the future.
I'd imagine that's top of both UK and US Govt agendas at present!
Just in case it isn't, choose a broker who can manage it effectively - for the 121st time!
That niggling little question that will never go away until "someone" takes a lead and gets it sorted out once and for all. As I said many moons ago.
I'm alright thanks, Jack. HaHa.
I was holding a small amount of shares last div date 1343 to be exact and got £29.95. Which works out 8 percent after deductions as you get 4 x dividends a year.
To give you a more specific answer, automatic US Witholding Tax deduction is 30% (assuming your holding is not in the US). You should be able to reduce the withholding to 15% courtesy of the double taxation treaty between the US and UK (assuming your based in the UK) by filling out form W8 BEN. There is however a wrinkle in that many UK brokers are holding client stocks in mingled accounts and so cannot/ will not apply the reduced rate for you (its a long running battle a lot of investors here have talked about) Trotsky may be correct about the ISA gross payment implications , I cant comment on ISA related, though have a sneaking suspicion that even with an ISA you may run into the same lack of UK broker co-operation. Good Luck!
The dividend is paid net of (irrecoverable) US WHT at 15% in ISAs and share trading accounts. However, under the terms of the double tax treaty, the dividend is paid gross, without the deduction of US WHT, to pension funds, SIPPs etc.
Hi all, please can someone clarify how much dividend is paid out for DEC. For example, the declared divi for Dec is 2.89p, so is 15% tax taken off this because this is an US company (even if you have an isa). So, does that mean shareholders only get 2.46p per share as divi? Or do we get the full 2.89p if these shares are held in an isa?
Thanks.