Computing the gross dividends will be the tricky part in any case (that’s currently the value add of finpension report).
There’s a non-zero chance doing dividend / 0.85 would be accepted for a purely US fund if you’d want to attempt.
(note: you have up to 3 year to claim DA-1, so someone could try this now for previous reports)
The detail per stock is not shared by Vanguard or Blackrock in the published documents but you could simply put the total of dividend and see if it’s accepted by the tax authorities.
I agree
The system need to work as follows
The first two things needs some sort of tech to keep the databases using public or private APIs and most likely some agreement between Finpension and ETF provider
I believe this is why ishares was selected because then multiple ETFs can be covered
It’s very interesting for sure, but the way I read it it would currently apply to iShares ETFs held within Finpension? As far as I understand given some of the available investments in Finpension are institutional mutual funds they can already recover the taxes on dividends. In any case it could be a great start for wider reclaiming of dividends for funds held elsewhere?
P.S. hope nobody mentions you can already do this in IBKR, I’m aware.
I think FP is targeting following audience
You are right, buying VOO in IBKR is much better than buying IUSA via Finpension. DIY portfolio management at IBKR using US ETFs is cheapest and most tax efficient. But I think FP is offering a wealth management one stop shop. IBKR is just a brokerage.
Having said that, I am impressed that FP is trying to find a differentiation in heavily competitive space.
This sounds reasonable. I’d certainly prefer to have all eggs in one basket for simplicity IF I was sufficiently confident about it.
Finpension is great, and looks like they’re looking to do all the right things for people who dig into investing (eg domicile in Schwyz for lowest tax upon withdrawal, good, flexible and transparent platform and app, wide range of investment options including the CS institutional mutual funds like Quality which nobody else has to my knowledge) but the fact of the matter is it’s not tested, it’s just too young to have had any sizeable number of people withdrawing their 3As from it. There’s probably heritage being built on the 2nd pillar offering. I really hope all goes swell, my 3A is with them after long consideration and I’ve no complaints. There was talk here that they’re pioneers but indeed young and untested in a fiercely competitive space, and that if a whale systemic bank decided to match their offerings then they’d be in trouble.
P.S. re banks, PF has a flat 72CHF/year fee for custody which also considers 18CHF/quarter trading fees as custody fee credits, so the custody is essentially free with any sort of regular buying. UBS is indeed 0.3% and 1% per trade which adds up fast. I thought ZKB was looking to make itself free? Not looking into it as I am not in ZH.
@finpension for a measly 0.39% p.a. rebate, I’m sure we can find volunteers to lobby most if not all cantons to get out of the hypothetical, get your methodology validated and pressure the Confederacy to follow through. 
I wrote to Vanguard Switzerland, asking if they could provide similar documentation for e.g. VUSA. Will report when they reply.
You can reclaim withholding tax with DA-1 on Säule 3a and Freizügigkeit, even though you don’t declare those for taxes, right? Or does finpension offer taxable accounts I’m not aware of?
The latter, this discussion is about the new finpension taxable account offering.
Exactly, so an optimized Mustachian (IBKR / US ETFs) shouldn’t be too excited about Finpension’s new offering, no 
?
I wish they’d do some magic with their 3a & vested benefit instead
I think DA-1 is to get a tax credit in switzerland. But pension funds want to have the withholding tax money back from the USA, because they don’t pay any taxes in Switzerland. I don’t know how they do it exactly, but the pension fund or the funds bought by them will have to get that directly from the USA.
I don’t know how you can make extra money with it, because it will probably be copied quickly. But if it works, it will be the best thing since sliced bread. This is real financial innovation and I hope that the publicity alone will fill your coffers many times over.
I think it is still a win.
With this new approach, some other services might get released (through other service providers) which can help all investors get their tax credit back for unrecoverable taxes.
Personally I don’t like US domicile ETFs but I accept them because of their advantages. But if some services evolve to reduce the gap for DIY investors, this preference would change
Ideally a fund house like UBS or Swisscanto should start providing these (unrecoverable tax credit) services for CH domicile Funds. Since these funds can be bought on exchanges, they would also work for DIY investors and will make it easier for Ictax too as they would need to deal with just one/two verifications. This will also help them gain share from IE domiciled funds.
For example UBS S&P 500 ETF or Fund domiciled in CH with tax credit facility and TER of <0.10% will be great.
It’s a pity that Swiss residents are buying IE domiciled funds provided by American companies. Money from Swiss residents should be going to Swiss funds. And UBS / Swisscanto should make it possible. It would be best for everyone.
I understand that because of Swiss WHT 35%, CH domicile funds are less attractive for International investors. But for Swiss investors this wouldn’t matter
I think you are simply not Finpension‘s target audience. ANY roboadviser will have more fees than diy self-managing.
They could however offer a simple brokerage account with no such functionality. But that could cost them customers from the robo and therefore make it not beneficial.
German free brokers such as scalable offer both. Free brokerage and a roboadvisor service for ~0.5% TER
I’m just now reading up on reclaiming withholding tax.
If I’m retired with no taxable income besides dividends from US stocks, and those dividends are low enough to cause zero income tax (neither federal nor cantonal income tax), “only” wealth tax, then reclaiming the withholding tax with DA-1 is not possible, because the maximum that can be reclaimed is zero?
In that case, the withheld 15% of dividends are truly lost, both for IE and US domiciled fonds? At least until dividends grow until they exceed the threshold above which income tax gets >0?
Yes, not possible. You can only reclaim parts of your divdend taxes you paid. This credit is solely to prevent double taxation. And as you were only taxed once, not possible to claim.
In your case a fund like SPYI and VWRL would also be more cost/tax effective probably. As you lose a double layer in tax on ex-US holdings in VT for example.
E: Also in that case a home bias makes even more sense tax wise. You have zero withholding tax on swiss stocks/funds after getting back the Verrechnungssteuer and that is independent of you tax rate.
No, cause Irish (normally withhold no tax when distributing to foreign investors like you.
No - it applies to many countries (that have non-recoverable WHT and a DTA).
It is not yet established if everyone is able or willing to provide the paperwork.
That said, finpension may still benefit from their early mover advantage.
Other robo-advisors would certainly be the first to offer the same.
I could imagine that it will take many years until the data is integrated in ICTax, which would be needed for people buying a world or US ETF through a broker (Swissquote etc.).
But not every online service keeps a securities account for you and could confirm the exact amount of tax withheld in your name.
Gotta look at it from the taxman’s perspective, who is used (and encouraged) to grant tax credits/refunds in a restrictive way: Are they going to accept a report from some random online services that doesn’t keep your account and can’t tell how many shares you actually own - vs. receiving a report from a Swiss financial services provider through which you actually hold your shares?
No, wrong.
Though pension funds held through such accounts may be exempt from foreign and/or withholding tax anyway.
Keep in mind that most US-domiciled ETFs (that are popular on this forum) will also hold non-US securities - which would then be subject to 15% withholding tax (with W8-BEN).
Example:
British company distributing to US ETF: 0% withholding tax.
US ETF distributing to you: 15% withholding tax.
British company distributing to Irish ETF: 0% withholding tax.
Irish ETF distributing to you: 0% withholding tax.
Tax advantage for Irish ETF.
I’ve looked into Finpension’s tax reporting module [source] and coded my own implementation. Obviously the numbers aren’t correct yet (but I use real data, just have to fix all the calculations). It’s actually very easy to do. When I get it to a end-user usable state I could release if for free and you can generate your own reports.
These are screenshots from a generated 54-page PDF. Kinda copied the layout from Finpension a bit, sorry…
Why is it 54 pages? It basically contains all received dividends, sorted by date.
Things I still need to implement:
Where do I get the data from?
Why? Seems like an interesting project + I learned a few new things like all the things ICTax has to offer.
@oswand when we now combine this with the Tax Declaration & ICTax logic, which is that your tax declaration shall contain daily transactions and that the tax authorities believe this. Meaning that if a share had an dividend ex date, the tax office just believes you that you had these shares at that date… the tax office does not require any bank confirmation that you either actually had the shares or received the divident.
If we apply the same principle, we could indeed just create a script that downloads all Dividend Ex Dates as per ICTAX (grossed up, pre-WHT), downloads the daily amount of shares the ETF Held, downloads the number of ETF Shares that existed at that time… and tadaaa we can in combination with your specific number of ETF held at that time create such a report.
So long story short: IF tax authorities approve such approach, we can as well do it for any other holdings we have even outside FP. So we all give FP big kudos, remember them in our daily prayor to lord mannon and then just proceed our DYI investing.
To be honest: I just can’t believe that the swiss tax office was willing to give up on all these tax revenues…
