So when you have VT or VXUS you can reclaim 100% of the dividend as a US-dividend because it is US ETF? Great.
Edit: but there might be taxes within the ETF that can’t be reclaim, right?
I’m really noob with this tax structure, what’s paid by the ETF, what’s taxed when distributing to ETF holder, what can be reclaimed.
Edit 2: may the lord gpt help my ignorance.
ETF domiciled in the Netherlands — overview
The Netherlands used to be a common domicile for ETFs (especially older iShares and SPDR funds), though most new UCITS ETFs are now in Ireland or Luxembourg for better tax efficiency. Still, several Dutch ETFs exist, so let’s unpack the structure.
1. Three taxation levels
| Level | What happens | Typical tax impact for CH investor |
|---|---|---|
| 1. Inside the fund | The ETF receives dividends from underlying holdings (U.S., EU, Asia, etc.). These may be taxed at source. | Yes – underlying withholding taxes (e.g. 15% U.S., 15% France, 10% Japan) are applied at the company level and generally not reclaimable by you. |
| 2. When the ETF distributes to you | The ETF pays a dividend (or reinvests it if accumulating). NL might withhold Dutch dividend tax unless exempt. | Normally 15% Dutch withholding tax, but exemption or refund applies for non-residents like Swiss investors. |
| 3. When you sell the ETF | You realize a capital gain. | Switzerland does not tax capital gains for private investors (if you’re not a professional trader). NL does not withhold any CGT for non-residents. So: no tax at sale.  |
2. Inside the fund — taxation at source
Example:
The ETF holds:
- 40% U.S. stocks
- 30% European stocks (France, Germany, UK)
- 30% Asia-Pacific
Here’s what happens:
- U.S. dividends: 15% U.S. withholding (NL–US treaty) → fund receives 85%.
- European dividends: taxed at local rates (15%–30%, depending on country and treaties).
- Asian dividends: similar withholding by source countries.
These withholding taxes are paid by the ETF and reduce its net asset value.
They are not reclaimable by you, because they happen at the fund level.
However, the ETF itself may reclaim part of it if treaty benefits apply.
3. When the ETF distributes to you (Swiss investor)
By default, Dutch dividend withholding tax = 15%.
BUT:
- The Netherlands–Switzerland tax treaty reduces this to 0% for most UCITS funds if you hold through a qualified intermediary or apply for refund.
- Many large ETFs already apply zero withholding for non-residents when held via a Swiss broker or custodian.
- If 15% is withheld anyway, you can reclaim it from the Dutch tax authorities (takes ~6–12 months).
So, the Dutch layer is usually reclaimable or avoided entirely if structured correctly.
4. Swiss tax treatment
For a private CH investor:
| Type of income | Swiss tax treatment | Comments |
|---|---|---|
| Dividends (distributions) | Taxable as income at your marginal rate | You declare the gross dividend (including any reclaimable foreign tax). |
| Capital gains | Tax-free for private investors | Unless you qualify as a professional trader. |
| Foreign withholding tax | Can often claim partial credit for unreclaimable taxes (like U.S. 15%) via DA-1 form. |
So, in Switzerland, you’ll typically be taxed only once on income, and capital gains remain tax-free.
5. Reclaim summary
| Layer | Typical rate | Reclaimable by CH investor? | How |
|---|---|---|---|
| U.S. withholding (inside ETF) | 15% |  No (fund-level) |
Already netted in NAV |
| European withholding (inside ETF) | 15–30% | No (fund-level) |
Sometimes fund-level reclaim |
| Dutch withholding (ETF → you) | 15% | Yes (via refund) |
NL–CH treaty or pre-exemption |
| Swiss income tax | Marginal rate | N/A | Declare income, no double taxation |
6. Practical implications
Advantages:
- No capital gains tax in CH or NL
- Dutch withholding tax reclaimable or avoided
- Double taxation mostly mitigated via Swiss DA-1 credit
Drawbacks:
- Underlying withholding taxes (U.S., EU, Asia) drag on performance
- Irish-domiciled ETFs often have slightly better treaty efficiency (especially for U.S. equities)
7. Comparison: NL vs IE domicile for a Swiss investor
| Feature |  Ireland ETF |
Netherlands ETF |
|---|---|---|
| U.S. dividend withholding | 15% | 15% |
| Dutch/Irish withholding on distributions | 0% | 0–15% (reclaimable) |
| Capital gains tax | None | None |
| Fund-level efficiency | High | Moderate |
| Best use case | Global or U.S. equities | European-focused ETFs |
Bottom line:
For a Swiss investor, a Netherlands-domiciled ETF is fine, but an Ireland-domiciled ETF is usually slightly more tax-efficient and operationally easier (no reclaim paperwork).