VOO, VUSD, VT - currency, dividend tax for acc/distrib

Investing / Portfolios
1

Hello fellow Mustachians!

I came to Switzerland 2 years ago and was already invested in IWDA Acc (Total world accumulating ETF) as accumulating ETFs are better for tax purposes in my country.

In Switzerland however, as I understand it, you pay the dividend tax whether it is accumulating or distributing ETF.

Because of this, seems like a distributing ETF would make more sense - it is easier to find out how much dividend I got vs. from an accumulating ETF (is this true? how hard is it to find out at IBKR?)

So if I want a distributing ETF based on SP 500 - is it best to buy one in USD or CHF? Would I be paying something extra on fees as CHF are probably hedged?

2

There is a difference between hedged ETF available in CHF vs. Unhedged ETF available in CHF. Both are possible

You have following choices for S&P 500 , unhedged versions

VOO (ISIN - US9229083632), sold in USD at NYSE, ETF domiciled in USA

SPY5 (ISIN - IE00B6YX5C33), possible to buy in CHF on SIX or USD on LSE, ETF domiciled in Ireland

There are more options for IE domiciled ETF like VUSA, IUSA etc. All track S&p 500

It would be cheapest to buy VOO on IBKR if you are comfortable with US domiciled ETFs.

3

Dividends for distributing ETFs is reported very clearly on IBKR. No problem.

For accumulating, it’s not reported on IBKR. However you can check taxable incomes for accumulating ETFs (for Swiss residents) on ICTAX Ictax

Technically speaking , you can continue to buy IWDA in Switzerland too and you can find the “theoretical dividend income” on ICTax. But now you also will have access to VT.

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4

Thank you so much!

Was actually thinking about VOO. What would be some reasons why someone would not be comfortable with US domiciled ETFs?

5

The main reason can be topic of US estate taxes. Switzerland is privileged with higher exemption limits, so for Swiss residents it’s less of an issue. But still something to be aware of.

A lot of discussion at link below. Please read the entire post with all responses because it is a nuanced topic.

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