Foreign withholding tax
If foreign withholding tax (WHT) applies in the country the company is located in, WHT is deducted from your dividend at the highest non-resident withholding tax rate and paid to the government in the country the company is based in. WHT rates vary between countries so the rate your dividend is taxed at will differ between ADRs.
Tax to the Australian Taxation Office
If you’ve supplied us with a valid Tax Filing Number (TFN), we’ll pay the dividend into your Sharesies Wallet without any further tax deductions and report your investment income to the Australian Taxation Office (ATO). In your tax return, you’ll need to report any income that you have received from foreign investments as foreign income.
While it’s not compulsory to supply us with your TFN, if you haven’t supplied us with a valid TFN we’re required to withhold tax at the highest rate, and Medicare levy from the gross dividend amount and pay it to the ATO on your behalf.
Capital gains tax (CGT)
CGT may apply to transactions on ADR investments. If you’re unsure if CGT applies to you, we recommend reaching out to a professional tax advisor for guidance.