IBKR Account DA1 refund declined - Account not in Switzerland

Taxes
1

Anyone here living in the canton of Zug ? I have severals US ETF’s in my IBKR account. The tax office declined my DA1 refund (Steuerrückbehalt USA) because of the following reason:

Steuerrückbehalt USA: Dieser wird nur auf Dividendenzahlungen von in der Schweiz verwahrten US-Aktien rsp. auf Zinszahlungen von in der Schweiz verwahrten US domestic bonds abgezogen

Is it because the IBKR Account is in the UK ?

1 Like
2

Did you not receive any refund ? Or you got less than requested

In the tax form of DA-1, there are two columns.

  1. withholding tax not refundable abroad
  2. Steuerrückbehalt USA

#2 is only applicable for brokerage accounts in Switzerland like Swissquote and is applied on US ETFs.

Since your account is in IBKR, the #2 is not applicable. Only #1 is applicable.

#2 sounds like tax held in US but it is not. It is tax withheld in Swiss institutions for US securities

Few years back when I was filling this form, I was always filling numbers in wrong column because i misunderstood the meaning of these columns. And tax office corrected it. I live in canton ZH.

For examples, let’s say you hold VTI etf

  • if it was held in IBKR, you would experience 15% WHT from dividends received and you can get it back via DA1 using only first column
  • If it was held in SQ, you would experience 15% WHT + 15% Additional deduction. This is what can be requested using both columns of DA1
4 Likes
3

Many thanks, now I understand. That is my mistake. It’s a bit confusing. I put the tax for the us ETF in the wrong column. That’s why I got the refund for my Canadian ETF’s but not the us once. I have to call the tax office. Hope they still can fix it.

1 Like
4

Hi

What role does the W8-Ben form play here?

My understanding is that completing this form removes one of the 15% deductions?

5

Yes, it removes 15% :wink:

6

Some more background to the initial question here.

The Tax authority in my Canton (SZ) informed me via my final tax statement for 2023 that it could not “guarantee the reimbursement of US witholding tax on my US dividends if my broker was not in Switzerland”.

Therefore, I availed of Swissquote fee reimbursement offering (up to CHF 500) and transferred all my US dividend paying stocks to them from my overseas broker. This process is now completed.

7

Just to be sure

  • You filed in WE8BN with IBKR
  • IBKR deducted treaty rate of 15% for US ETfs like VT, VTI etc
  • You filled in DA 1 to reclaim 15%
  • Tax office in Schwyz rejected the claim ?

To me it sounds very strange because this is first time I hear something like this

8

The Broker was a large retail broker based in Ireland (I’ve used them for the last 20+ years).

I have W8-Ben filed with them and they only deducted 15% DWT from the US dividends.

I filled out the normal SZ tax return.

SZ sends me (approx 1.5 years after the Tax year end) a very confusing schedule with an overall DWT reclaimed (recredit) with an overall number. [not a detailed listing]. This overall number related to All share holdings (incl German/French/Spanish/Austrian etc). Hence it is impossible to see what has been recredited.

The only thing I get in relation to the US DWT is the comment that “holdings held outside CH cannot be guarateed to be reclaimed” and this is specifically written at the end of the “Definitiv final tax statement”.

Their tax software only asks for proof of the US DWT and I get a statement from the Irish based broker for each holding and supply this as part of my online return to SZ. I’m hoping to have better luch with Swissquote and that is why I moved the US holdings to them.

1 Like
9

Thanks for sharing this.

I hope such issues don’t arise from IBKR too. IB is the most used broker based on the responses from folks on this platform

10

Didn’t they mean that in some cases it will be only partially refunded? See the other related thread:

And this is unrelated to the broker…

1 Like