Foreign pages on SA - questions on foreign stock holdings

itwasntme001

I am completing my self assessment for 24/25 and need to complete the foreign pages.  I have some questions on 2 companies I own - BABA which is an ADR traded in the US and Brookfield (BN) which is traded in the US as a common stock.  Both in a GIA account.

1) for BABA there is dividend paid out and an ADR fee taken from this dividend such that I receive the net amount.  What do I enter for amount received before tax i.e. column B?  The amount before the fee or amount net of fee?  Essentially is the ADR fee tax deductible?

2) for BN, since this is a canadian company (but traded in US exchanges) I can see that a 25% tax rate has been applied on the dividend and so I have received the net amount after this tax.  The holding is with interactive investor and there is no Canadian version of WBEN form filled in, and I do not think you can do this with ii (although not sure - you can with AJbell).  Does this mean I can not get foreign tax credit relief and so not only have I been taxed at 25% canadian tax but will be dividend taxed in the UK on this gross (or is it net?) amount?

TIA.

wmb194

itwasntme001 said:

I am completing my self assessment for 24/25 and need to complete the foreign pages.  I have some questions on 2 companies I own - BABA which is an ADR traded in the US and Brookfield (BN) which is traded in the US as a common stock.  Both in a GIA account.

1) for BABA there is dividend paid out and an ADR fee taken from this dividend such that I receive the net amount.  What do I enter for amount received before tax i.e. column B?  The amount before the fee or amount net of fee?  Essentially is the ADR fee tax deductible?

2) for BN, since this is a canadian company (but traded in US exchanges) I can see that a 25% tax rate has been applied on the dividend and so I have received the net amount after this tax.  The holding is with interactive investor and there is no Canadian version of WBEN form filled in, and I do not think you can do this with ii (although not sure - you can with AJbell).  Does this mean I can not get foreign tax credit relief and so not only have I been taxed at 25% canadian tax but will be dividend taxed in the UK on this gross (or is it net?) amount?

TIA.

1. The ADR fee isn't deductible. 2. You can claim tax relief at the UK-Canada treaty rate - 15%. You can try reclaiming the balance from the Canadian tax authorities - Canada keeps 15% - but for small amounts it might not be worth the effort.

itwasntme001

wmb194 said:

itwasntme001 said:

I am completing my self assessment for 24/25 and need to complete the foreign pages.  I have some questions on 2 companies I own - BABA which is an ADR traded in the US and Brookfield (BN) which is traded in the US as a common stock.  Both in a GIA account.

1) for BABA there is dividend paid out and an ADR fee taken from this dividend such that I receive the net amount.  What do I enter for amount received before tax i.e. column B?  The amount before the fee or amount net of fee?  Essentially is the ADR fee tax deductible?

2) for BN, since this is a canadian company (but traded in US exchanges) I can see that a 25% tax rate has been applied on the dividend and so I have received the net amount after this tax.  The holding is with interactive investor and there is no Canadian version of WBEN form filled in, and I do not think you can do this with ii (although not sure - you can with AJbell).  Does this mean I can not get foreign tax credit relief and so not only have I been taxed at 25% canadian tax but will be dividend taxed in the UK on this gross (or is it net?) amount?

TIA.

1. The ADR fee isn't deductible. 2. You can claim tax relief at the UK-Canada treaty rate - 15%. You can try reclaiming the balance from the Canadian tax authorities - Canada keeps 15% - but for small amounts it might not be worth the effort.

Thanks.

For 2., I never filled in the W8-BEN equivalent for Canada, so does the 15% tax relief claim still apply?

Also, in the foreign pages of the SA, do I put in the actual tax paid (25%) for column C (tax paid) or 15% of the gross?

masonic

itwasntme001 said:

wmb194 said:

itwasntme001 said:

I am completing my self assessment for 24/25 and need to complete the foreign pages.  I have some questions on 2 companies I own - BABA which is an ADR traded in the US and Brookfield (BN) which is traded in the US as a common stock.  Both in a GIA account.

1) for BABA there is dividend paid out and an ADR fee taken from this dividend such that I receive the net amount.  What do I enter for amount received before tax i.e. column B?  The amount before the fee or amount net of fee?  Essentially is the ADR fee tax deductible?

2) for BN, since this is a canadian company (but traded in US exchanges) I can see that a 25% tax rate has been applied on the dividend and so I have received the net amount after this tax.  The holding is with interactive investor and there is no Canadian version of WBEN form filled in, and I do not think you can do this with ii (although not sure - you can with AJbell).  Does this mean I can not get foreign tax credit relief and so not only have I been taxed at 25% canadian tax but will be dividend taxed in the UK on this gross (or is it net?) amount?

TIA.

1. The ADR fee isn't deductible. 2. You can claim tax relief at the UK-Canada treaty rate - 15%. You can try reclaiming the balance from the Canadian tax authorities - Canada keeps 15% - but for small amounts it might not be worth the effort.

Thanks.

For 2., I never filled in the W8-BEN equivalent for Canada, so does the 15% tax relief claim still apply?

W8-BEN, as it applies to the US, is a way to avoid having to reclaim withholding tax by not paying the excess in the first place. If you were to complete this, or a NR301 for Canada, it would only apply to future dividends, not anything already received net of the higher rate.

itwasntme001

masonic said:

itwasntme001 said:

wmb194 said:

itwasntme001 said:

I am completing my self assessment for 24/25 and need to complete the foreign pages.  I have some questions on 2 companies I own - BABA which is an ADR traded in the US and Brookfield (BN) which is traded in the US as a common stock.  Both in a GIA account.

1) for BABA there is dividend paid out and an ADR fee taken from this dividend such that I receive the net amount.  What do I enter for amount received before tax i.e. column B?  The amount before the fee or amount net of fee?  Essentially is the ADR fee tax deductible?

2) for BN, since this is a canadian company (but traded in US exchanges) I can see that a 25% tax rate has been applied on the dividend and so I have received the net amount after this tax.  The holding is with interactive investor and there is no Canadian version of WBEN form filled in, and I do not think you can do this with ii (although not sure - you can with AJbell).  Does this mean I can not get foreign tax credit relief and so not only have I been taxed at 25% canadian tax but will be dividend taxed in the UK on this gross (or is it net?) amount?

TIA.

1. The ADR fee isn't deductible. 2. You can claim tax relief at the UK-Canada treaty rate - 15%. You can try reclaiming the balance from the Canadian tax authorities - Canada keeps 15% - but for small amounts it might not be worth the effort.

Thanks.

For 2., I never filled in the W8-BEN equivalent for Canada, so does the 15% tax relief claim still apply?

W8-BEN, as it applies to the US, is a way to avoid having to reclaim withholding tax by not paying the excess in the first place. If you were to complete this, or a NR301 for Canada, it would only apply to future dividends, not anything already received net of the higher rate.

Understood, but does claiming for the tax credit depend on me having to fill in NR301, or can I still obtain the credit given I will be taxed at 8.75% in the UK on top of the 25% I have paid to Canada?  So max would be 15% and I will actually get a 8.75% credit.

itwasntme001

Also how does the tax treatment/treaties work for Cayman Islands and Guernsey, where I have share holdings incorporated in?  No tax was paid on the dividends, but do I have to pay the 8.75% tax on these in the UK or am I allowed to get some or all credited according to treaties etc?

masonic

You will still be able to enter details of the dividends and foreign tax paid in your tax return to benefit from any credit available.

Where there is a double taxation treaty in place with another country and you've paid no foreign tax, then yes you can also claim a credit to reduce UK tax by the full 0% paid.

wmb194

itwasntme001 said:

wmb194 said:

itwasntme001 said:

I am completing my self assessment for 24/25 and need to complete the foreign pages.  I have some questions on 2 companies I own - BABA which is an ADR traded in the US and Brookfield (BN) which is traded in the US as a common stock.  Both in a GIA account.

1) for BABA there is dividend paid out and an ADR fee taken from this dividend such that I receive the net amount.  What do I enter for amount received before tax i.e. column B?  The amount before the fee or amount net of fee?  Essentially is the ADR fee tax deductible?

2) for BN, since this is a canadian company (but traded in US exchanges) I can see that a 25% tax rate has been applied on the dividend and so I have received the net amount after this tax.  The holding is with interactive investor and there is no Canadian version of WBEN form filled in, and I do not think you can do this with ii (although not sure - you can with AJbell).  Does this mean I can not get foreign tax credit relief and so not only have I been taxed at 25% canadian tax but will be dividend taxed in the UK on this gross (or is it net?) amount?

TIA.

1. The ADR fee isn't deductible. 2. You can claim tax relief at the UK-Canada treaty rate - 15%. You can try reclaiming the balance from the Canadian tax authorities - Canada keeps 15% - but for small amounts it might not be worth the effort.

Thanks.

For 2., I never filled in the W8-BEN equivalent for Canada, so does the 15% tax relief claim still apply?

Also, in the foreign pages of the SA, do I put in the actual tax paid (25%) for column C (tax paid) or 15% of the gross?

You can still claim the relief, after all you've paid the tax, but only up to the treaty rate. HMRC doesn't care what foreign forms you have or have not completed.

I use tax software to complete my returns; check what it says in the Foreign Pages notes.

PloughmansLunch

wmb194 said:

itwasntme001 said:

wmb194 said:

itwasntme001 said:

I am completing my self assessment for 24/25 and need to complete the foreign pages.  I have some questions on 2 companies I own - BABA which is an ADR traded in the US and Brookfield (BN) which is traded in the US as a common stock.  Both in a GIA account.

1) for BABA there is dividend paid out and an ADR fee taken from this dividend such that I receive the net amount.  What do I enter for amount received before tax i.e. column B?  The amount before the fee or amount net of fee?  Essentially is the ADR fee tax deductible?

2) for BN, since this is a canadian company (but traded in US exchanges) I can see that a 25% tax rate has been applied on the dividend and so I have received the net amount after this tax.  The holding is with interactive investor and there is no Canadian version of WBEN form filled in, and I do not think you can do this with ii (although not sure - you can with AJbell).  Does this mean I can not get foreign tax credit relief and so not only have I been taxed at 25% canadian tax but will be dividend taxed in the UK on this gross (or is it net?) amount?

TIA.

1. The ADR fee isn't deductible. 2. You can claim tax relief at the UK-Canada treaty rate - 15%. You can try reclaiming the balance from the Canadian tax authorities - Canada keeps 15% - but for small amounts it might not be worth the effort.

Thanks.

For 2., I never filled in the W8-BEN equivalent for Canada, so does the 15% tax relief claim still apply?

Also, in the foreign pages of the SA, do I put in the actual tax paid (25%) for column C (tax paid) or 15% of the gross?

You can still claim the relief, after all you've paid the tax, but only up to the treaty rate. HMRC doesn't care what foreign forms you have or have not completed.

I use tax software to complete my returns; check what it says in the Foreign Pages notes.

Which software do you use please? I also have foreign income and other complexities so would be interested in recommendations to make sure I’m completing my SA correctly.

wmb194

PloughmansLunch said:

wmb194 said:

itwasntme001 said:

wmb194 said:

itwasntme001 said:

I am completing my self assessment for 24/25 and need to complete the foreign pages.  I have some questions on 2 companies I own - BABA which is an ADR traded in the US and Brookfield (BN) which is traded in the US as a common stock.  Both in a GIA account.

1) for BABA there is dividend paid out and an ADR fee taken from this dividend such that I receive the net amount.  What do I enter for amount received before tax i.e. column B?  The amount before the fee or amount net of fee?  Essentially is the ADR fee tax deductible?

2) for BN, since this is a canadian company (but traded in US exchanges) I can see that a 25% tax rate has been applied on the dividend and so I have received the net amount after this tax.  The holding is with interactive investor and there is no Canadian version of WBEN form filled in, and I do not think you can do this with ii (although not sure - you can with AJbell).  Does this mean I can not get foreign tax credit relief and so not only have I been taxed at 25% canadian tax but will be dividend taxed in the UK on this gross (or is it net?) amount?

TIA.

1. The ADR fee isn't deductible. 2. You can claim tax relief at the UK-Canada treaty rate - 15%. You can try reclaiming the balance from the Canadian tax authorities - Canada keeps 15% - but for small amounts it might not be worth the effort.

Thanks.

For 2., I never filled in the W8-BEN equivalent for Canada, so does the 15% tax relief claim still apply?

Also, in the foreign pages of the SA, do I put in the actual tax paid (25%) for column C (tax paid) or 15% of the gross?

You can still claim the relief, after all you've paid the tax, but only up to the treaty rate. HMRC doesn't care what foreign forms you have or have not completed.

I use tax software to complete my returns; check what it says in the Foreign Pages notes.

Which software do you use please? I also have foreign income and other complexities so would be interested in recommendations to make sure I’m completing my SA correctly.

TaxCalc. It has a "SimpleStep" feature that can walk you through it or, if you prefer, you can do it the hard way with HMRC's layout.

https://www.taxcalc.com/individual

itwasntme001

wmb194 said:

itwasntme001 said:

wmb194 said:

itwasntme001 said:

I am completing my self assessment for 24/25 and need to complete the foreign pages.  I have some questions on 2 companies I own - BABA which is an ADR traded in the US and Brookfield (BN) which is traded in the US as a common stock.  Both in a GIA account.

1) for BABA there is dividend paid out and an ADR fee taken from this dividend such that I receive the net amount.  What do I enter for amount received before tax i.e. column B?  The amount before the fee or amount net of fee?  Essentially is the ADR fee tax deductible?

2) for BN, since this is a canadian company (but traded in US exchanges) I can see that a 25% tax rate has been applied on the dividend and so I have received the net amount after this tax.  The holding is with interactive investor and there is no Canadian version of WBEN form filled in, and I do not think you can do this with ii (although not sure - you can with AJbell).  Does this mean I can not get foreign tax credit relief and so not only have I been taxed at 25% canadian tax but will be dividend taxed in the UK on this gross (or is it net?) amount?

TIA.

1. The ADR fee isn't deductible. 2. You can claim tax relief at the UK-Canada treaty rate - 15%. You can try reclaiming the balance from the Canadian tax authorities - Canada keeps 15% - but for small amounts it might not be worth the effort.

Thanks.

For 2., I never filled in the W8-BEN equivalent for Canada, so does the 15% tax relief claim still apply?

Also, in the foreign pages of the SA, do I put in the actual tax paid (25%) for column C (tax paid) or 15% of the gross?

You can still claim the relief, after all you've paid the tax, but only up to the treaty rate. HMRC doesn't care what foreign forms you have or have not completed.

I use tax software to complete my returns; check what it says in the Foreign Pages notes.

Thanks, this makes sense now, so for Canada I put 15% as the max I can claim (but actual credit is at 8.75%).

For Guernsey and Cayman, what masonic implied that since there is no foreign tax paid, there can not be any credit.  But is it as simple as that, doesn;t it depend on what the treaty itself says?