A short summary of information discussed with one user who decided to delete own account and all posts.
ETFs domiciled in Canada could be an interesting alternative to US based ETFs in some cases. For example, vanguard.ca has
FTSE Developed All Cap ex U.S. Index ETF (VDU)
FTSE Developed All Cap ex North America Index ETF (VIU)
As well as ETFs on Canadian stocks:
FTSE Canada Index ETF (VCE)
FTSE Canada All Cap Index ETF (VCN)
And now I have a question concerning level 2 withholding tax on dividends distributed by Canadian funds or stocks. According to this summary
the standard withholding tax of 25% is reduced to 15% for individuals.
Does anyone has a first hand experience receiving dividends from CA securities? Is the withholding tax really 15%? Is it possible to reclaim these taxes as tax credit in CH (DA-1 Form?)?
Many thanks to anyone sharing experience.
Through Interactive ones.
Canadian ETF on Canadian stocks have lower TER and more advantageous tax treatment then IE and US ones. For developed ex US it is probably somewhat worse then Ireland, but there are no such ETFs with Irish domicile. Many forum members don’t want to invest in developed ex US via a US ETF, that’s how CA ETFs came into discussion.
I can confirm that IB charged 15% withholding tax for VCE. I hope they will be recovered through DA-1, but let’s see.
Hi everyone,
Interactive Brokers has reduced my canadian withholding tax from 25 to 15% on NYSE: BN (Brookfield)
On the dividend withhold statement it clearly says Canadian tax.
I thought that the W8-BEN only reduces withholding tax on US sources from 30 to 15 %
However Brookfield is a canadian company, double listed on TSX and NYSE.
Does anyone know why exactly it is reduced? Because it’s listed on NYSE?
15% is the rate as per CA-CH tax treaty. It has nothing to do with W8-BEN, that’s for US domicile, only.
Your post is a bit older, but in case it’s still relevant: I had no issues to reclaim the 15%, e.g. for VCN for years.
I understand that, but it confuses me that IB reduces it for canada but not for other countries like france/italy. They charge me the full withhold tax on these dividends. So how can they reduce it on canadian dividends but not on others that are also treaty eligible?