Most tax efficient listing and account for non UK share dividend

expansion

For an international company listed on multiple exchanges including London what is the most tax efficient listing and account combination?

As an example consider a German or French company listed on numerous exchanges - Paris, Frankfurt, London, New York. Is one better than the other from a UK investor's perspective? Is buying the New York listed inside a SIPP the most tax efficient when it comes to dividends?

bowlhead99

Where tax treaties are concerned it can generally be more useful to invest via a pension than an ISA or unwrapped because pensions are more internationally recognised as vehicles for low-tax investing.

However, France's withholding is only 12.8% for individuals while their standard withholding for non-individuals is 30% (but capped at 15% under tax treaty for corporations and pension funds). Still, if you were going to pay French WHT either way, and are a higher rate UK taxpayer, you might as well use a tax wrapper to at least avoid the UK tax on the income.

Is buying the New York listed inside a SIPP the most tax efficient when it comes to dividends?

If you are buying a share (or depositary receipt) of the French corporation through a foreign listing such as London or NY, it's still a French corporation and French withholding tax is relevant for the beneficial owner (e.g. UK individual or UK pension scheme). I'm not aware of a loophole that would convert it into 'US source income' or 'UK source income' just because the French source income was being paid on a US ADR or on shares purchased via a London listing. So just because the US can give you 0% US withholding tax on US source income  received by a SIPP and the UK can give you 0% withholding tax on UK source income received by a SIPP - there is no obvious scope to say that buying inside a SIPP will allow you to avoid all withholding, because fundamentally what you're receiving is French income.

If the UK listing is in GBP (even if dividends paid in EUR), the lack of fx commissions on the buy and eventual sell might swing it to be more efficient to use London as a venue, especially as UK brokers sometimes charge more for trading on foreign exchanges.