# Dividend tax withholds for foreign investors in Aussie stocks



## topo (12 May 2010)

good day

can anybody inform me, how the Dividends of an Australian Stock is taxed for foreign Investors?

I habe an InteractiveBrokers Account for trading in Australia and the told me following regarding this:

...There is a scenario in which a tax could be withheld. Generally, the company will disclose to foreign investors when and if a withholding tax applies. Dividends paid by companies to non-residents are subject to the tax rules of the company's tax home country and may be subject to a withholding tax. Since IB would not act as the withholding agent, the tax would be withheld by the paying agent prior to IB receiving the dividend payment......

so how a Foreign Shareholder will be taxed in Australia?

it cant be that much, as even foreign Pensionfonds are investing in Australian Companies...

thanks for any Answer in advance

Cheers


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## UBIQUITOUS (12 May 2010)

I believe that the rate depends upon which country you are a resident of. It all gets trued up on your tax return in the country in which you are a resident for tax purposes.


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## son of baglimit (12 May 2010)

http://www.ato.gov.au/businesses/content.asp?doc=/content/50240.htm&page=1&H1

30% for dividends – fully franked dividends are not subject to withholding tax 

However, if the payment is made to resident of a country with which Australia has a tax treaty, you may be required to withhold less tax or no tax at all. 

Tax treaties are special agreements that Australia has entered into with over 40 countries. The tax treaties prevent the same income being taxed more than once.


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## Krusty the Klown (19 May 2010)

Following on from Son of's reply there is no one single answer.

It depends on what country you originate in, what business you conduct etc, what your circumstances are.....

The advice you seek wlll not be gained from an internet forum, you need to see an Australian tax adviser in a formal capacity.

There is just too many unknowns and the laws are just too complex..... and at this point in time changing constantly.....


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