# Tax optimisation for ETF investing

**URL:** https://forum.mustachianpost.com/t/tax-optimisation-for-etf-investing/67
**Category:** Wiki
**Created:** [October 31, 2016, 7:22am UTC](https://forum.mustachianpost.com/t/tax-optimisation-for-etf-investing/67 "2016-10-31T07:22:20Z")
**Posts on this page:** 1
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### Author: ![MrRIP](https://forum.mustachianpost.com/user_avatar/forum.mustachianpost.com/mrrip/32/26_2.png) [@MrRIP](https://forum.mustachianpost.com/u/MrRIP)
#### Post date: [November 11, 2016, 12:12pm UTC](https://forum.mustachianpost.com/t/tax-optimisation-for-etf-investing/67/2 "2016-11-11T12:12:39Z")

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Disagree on your general rule for US stocks funds.  
Distributing is better than accumulating - AGREE  
Domicile IE \> LU \> US - DISAGREE

No matter what, on US stocks the IRS takes 15% withholding tax on dividends. If your fund is domiciled elsewhere, it’s the fund itself that’s been taxed so you have no way to get that 15% back. You’re going to be taxed again in Switzerland (withhold 35-39%).

If your fund is US domiciled you can reclaim that 15% US withhold on dividends using the form DA-1, then pay your swiss withholding.

US domiciled funds with distributing policy let you save that 15% on dividends. Now, what’s the impact of this? The [S&P500 dividend yeld](https://ycharts.com/companies/SPY/dividend_yield) is ~2%. 15% of 2% is 0.3%. US funds let you save that 0.3% of double taxation.

Be careful though, with holding a US domiciled fund your heirs may incur in [US estate tax](https://en.wikipedia.org/wiki/Estate_tax_in_the_United_States), but only if your wealth is big enough.

Having said all that, what do I own? An IE domiciled, accumulating S&P500 fund -.-’’ that’s because I invested before doing this research and I’m scared of changing and paying transaction fees.

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