W8 - Ben

[Genasys]

I hold shares in an american company. Every year I fill out the W8-BEN form and send it back to my american broker. My understanding of the W8-BEN was no tax should be charged. However, every dividend cheque I receive has tax, albeit a small amount, applied. Does filling out the W8-BEN only reduce my tax liability or should it mean that no tax at all applies?

 

[RainyDay]

US authorities will still deduct tax. You can avoid being taxed on the double by noting this tax already paid when you are calculating your Irish tax liability.

 

[ClubMan]

That's not my experience. Having filled in W8-BEN forms from time to time when notified by various US brokers (e.g. Datek/Ameritrade and E*Trade in particular) I have never had any US taxes witheld and no deductions other than broker charges and the SEC levy of 1/30,000th of the value of a trade.

 

[extopia]

I believe 15% is the normal witholding rate for Irish citizens with a W8 on file. There are other rates in use for shares of certain types of company.

[broken link removed] explanatory leaflet may be of assistance.

 

[ClubMan]

Ah - now I know why I never had tax witheld: because I've never held shares that paid dividends! I assumed that we were talking about income and/or capital gains taxes here and not dividend witholding tax. Apologies for any confusion caused.