Nasdaq28 May 2026 09:53
With some assumptions on here around a potential listing on Nasdaq, I looked at what possible tax liabilities for us investors domiciled outside of the USA.
AI gave me an answer.
As a UK resident, your US-sourced dividends are subject to a US withholding tax (reduced to 15% via a W-8BEN form), while US capital gains are generally zero-rated. In the UK, you are taxed on worldwide income but can use Foreign Tax Credits to offset US tax against your UK tax liability.The US-UK tax implications divide distinctly into Dividends and Capital Gains:
1. Dividend IncomeUSA (Source Country): Under US domestic law, non-US residents face a 30% withholding tax on US dividends. However, under the US-UK Double Taxation Treaty, this is reduced to 15%. To get this reduced rate, you must file a W-8BEN form with your broker.UK (Residence Country): Because UK residents are taxed on worldwide income, these dividends must be reported on your Self Assessment tax return. You will pay UK dividend tax on them, but you can deduct the 15% US withholding tax paid as a Foreign Tax Credit against your overall UK tax liability.
2. Capital GainsUSA (Source Country): Thanks to the US-UK Double Taxation Treaty, the US generally does not charge capital gains tax on US-listed shares held by non-US citizens/residents.UK (Residence Country): If held outside a tax wrapper, any profit made from selling the shares is subject to UK Capital Gains Tax (CGT). You will report the gain in GBP, applying your annual CGT allowance and appropriate tax bands.3. Tax Shelters (ISAs and SIPPs)If you hold Nasdaq stocks within a UK Stocks & Shares ISA or SIPP, these wrappers completely shield your investments from UK Income and Capital Gains tax. However:The US still imposes its 15% withholding tax on US dividends.Because ISAs do not qualify as retirement accounts under the US-UK treaty, you cannot reclaim that 15% US tax.
Happy days for those of us holding our shares in an ISA… should it come to pass!………👍
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