Dividend taxation

[mace21]

This is an extremely noobish question and I have read similar posts but still looking for some clarity.

I’m interested in setting up a dividend portfolio and from what I’ve read, with Degiro’s custody account, there are fees that come with dividends but none with the basic account? Is that correct?

Also as far as taxation I’ve read about some issues regarding Degiro’s withholding tax. What are the differences between dividend withholding tax at DEGIRO va Swissquote? I was under the impression that in Switzerland they get taxed at 35% regardless of the broker you choose?

Thanks in advance

[ProvidentRetriever]

Hi @mace21!

@mace21

in Switzerland they get taxed at 35%

This 35% is not really a tax, it’s more like a withheld amount that you get back when you declare them in your tax form. The dividend is then taxed as if it were part of your salary and this is independent of your broker.

[San_Francisco]

Irrespective of 35% Swiss Verechnungssteuer, withholding tax may (additionally) be withheld on dividend payments from other countries.

[mace21]

Ok thanks. So for me, trying to build up a dividend portfolio, it would be wiser to use a DEGIRO standard account? custody accounts incur max 10% fee and swissquote commissions are simply too high.

[San_Francisco]

@mace21

it would be wiser to use a DEGIRO standard account? custody accounts incur max 10% fee

DeGiro with their custody account nickel-and-dime you for every dividend processed. I mean… sure, currency conversion is one thing. But not to many (online) brokers charge you these fees for dividend processing.

Otherwise, see ProvidentRetriever’s post above: If you have a job in Switzerland and declare taxes, the 35% Verrechnungssteuer should be pretty much irrelevant. Your broker might withhold them - they should be refunded through your tax return anyway.