That would be indeed interesting!
PS: Is there any ‘developed world ex-US’ (VXUS style) in IE at all? I didn’t find any so far.
Another thing I would like to figure out is how does L2WT look like for LU and DE (Japan or other AsiaPac ones would also be interesting though!) For LU/DE specifically there are some interesting ETFs around - and I’m wondering if they have 0% L2WT for CH based investors like the IE ones…
If anyone has an insight that would be greatly appreciated!
LU and DE are 15% WHT for dividends, which can be fully reclaimed via DA-1.
You find a country list at the tax administration webpage: https://www.estv.admin.ch/estv/de/home/internationales-steuerrecht/fachinformationen/quellensteuer-nach-dba.html
See the document “Vertragliche Begrenzungen der ausländischen Steuern“ available in French and German.
0% at source applies to Hongkong, Indien, Irland, Kuwait, Malta, Singapur, das Vereinigte Königreich (UK) und Zypern.
I don´t know of any attractive developed world ex-US from IE, that was only an example. You could substitute with two ETF, Europe and Asia-Pacific.
I do have interests in IE-domiciled Europe ex UK from Vanguard and Asia-Pacific ex JP from iShares but have not analyzed these for tax efficiency.
Did someone actually manage to reclaim L2TW with a DA-1 for a US-domiciled etf? I live in Basel Stadt and the tax pc program (Baltax) would not let me choose DA-1 for any ETF, only works for US shares. Anyone willing to share the practicalities of doing this?
Thanks,
Sunny
I already got money last year. This is how I fill it out with the official Zurich web tool.
Note: it fails to look up VT, VTI, VXUS, etc. in ESTV, I have to type all the dividends manually from ESTV.
Isn’t there an address where we can write to ask for the inclusion of them?
Try to put your ETF as a stock. At the end for taxation is the same, both have specific number. Yes, every tax software in each canton is different even if the name seems the same…
That’s federal. We have an issue with the Zurisoftware. I am not sure there is a common database between them.
The refund is federal but as it’s managed by delegation to Canton. Each on of them have developed their own software and is handling the refund differently.
In Vaud, you have a specific page for DA-1, but you send the whole tax declaration to the same adresse.
I wrote to them and this is what they write back:
Ich würde Ihnen vorschlagen, Ihre Valorennummern, Titel etc. einzugeben ohne das benutzen der Online-Kursliste. Dann können Sie alles selber eingeben und müssen Ihre Valorennnummer nicht einzeln suchen. Um die Online-Kursliste zu deaktivieren, klicken Sie rechts in der Wertschriften-Detailerfassung auf das Kästchen bei ‘Online-Kursliste benutzen’, so dass dieses Kästchen leer wird.
Freundliche Grüsse
Ihre Hotline ZHprivateTax
It’s a completely lazy generic answer. They don’t even want to fix their own bugs…
I know other people who tried to have them add the “DA-1” bit for VT&friends. IIRC they replied some generic thing that they are not eligible for DA-1.
Maybe it’s just they don’t want to bother computing the exact withholding, since for funds it’s not always 15%, e.g. BND has interests distribution that don’t have withholding.
I complained further and they said:
Dieser Fall ist uns nur bei Ihnen bekannt. Wir nehmen Ihr Feedback ernst und werden dem nachgehen. Bis dahin, geben Sie bitte Ihre Daten wie schon erwähnt ein.
The DA1 From in Solothurn-Tax Seems to work and automatically gets the dividends.
Clasic Switzerland XD every canton makes/buys their own software with variing levels of broken.
Solothurn apparently makes Dr. Tax available for free.
Most other Kanton’s seem to have a shared Java program (with some tweaks on top - but the same underlying codebase), which has the same bug where US ETF’s are automatically marked as funds, which are mutually exclusive with the DA-1.
In Vaud, the software is not connected to the database, you need to enter everything manually and if you fill everything correctly, your fortune is calculated 4x times^^. You need to trick the data.
The worst in some cases what you are entering in the software is not the same as in the PDF in output and the tax office only check the pdf.
Does anybody have an official (legal Irish) source for this claim? All I could find was this: Exemptions for non-residents
But it says that non-residents need to file a V2A form? Would the Broker do that for me? Or is the Broker even the recipient of those dividends (if stocks/etfs are not held directly in my name)? Or are ETFs generally exempt from withholding taxes?
Not that I’ve checked relevant legislation and treaties myself, but found this:
Funds domiciled in Ireland pay only 15% level 1 witholding tax on dividends from U.S. companies, while funds domiciled in Luxembourg pay 30%:
“Bei kollektiver Anlage in amerikanische Aktien hat eine Kollektivanlage mit Domizil Irland gegenüber den Fondsdomizilen Luxemburg oder Schweiz klare Vorteile.”
Yep, LU funds would pay 30% on US stocks, but I think most of them for this reason are swap based rather than replicated to avoid such large taxation hit. It’s still worse than direct ownership of US funds and reclaiming money via treaty
Hello there,
I have a question, probably a silly one, regarding tax optimization for ETF. I do understand that for ETFs that hold a significant percentage of US securities, it is beneficial to hold the US based one instead of the UCIT version e.g. Vanguard Total World Stock ETF (VT) instead of Vanguard FTSE All-World UCITS ETF Distributing (VWRD). This is due to the US/Switzerland tax treaty allowing us the reclaim the amount withhold by the US only for the US domiciled ETF. I am not even talking about the lower TER.
Now, for ETF that does not hold US securities such as emerging market ones of developed world ex-US. Besides a usually lower TER for the US domiciled ETF, is there a reason to hold the US domiciled one instead of an UCIT one? For example, a good US domiciled emerging market ETF would be Vanguard FTSE Emerging Markets ETF (VWO), TER=0.12%. An UCIT one would be the iShares Core MSCI Emerging Markets IMI UCITS ETF, TER=0.18%. For sure, they do not track the same index and the UCIT one has a slightly higher TER. But beside that, is there a strong reason to hold the US domiciled one instead of the UCIT one?
without quantifying, there is a difference in source taxes that the fund has to pay to the respective government. here IE is said to be better than US. You’d need to mak some comparisons on L1TW for both funds
apart from that nothing comes to my mind
