US withholding
Paying 15% instead of 30% on US dividends
A US company pays a dividend to someone who is not American and 30% is taken off before it leaves. The Portugal–US tax treaty caps that at 15% — but only for someone whose broker holds a valid W-8BEN. It is the difference between keeping 70% and keeping 85% of every US dividend you will ever be paid, and most people never check which one they are on.
Import your statementNo account needed. The file is read in your browser and stays there.
What the form is
A short US tax form on which you state that you are not a US person and name your country of residence, so the treaty rate can be applied to you. You do not send it to the IRS: your broker holds it and withholds accordingly. It stays valid until the end of the third calendar year after you sign it, so it expires quietly and has to be renewed.
30% or 15%
Thirty per cent is the statutory rate the United States applies to dividends paid to a non-resident. The treaty between Portugal and the United States limits the rate on dividends to fifteen. Without a valid form on file the broker has no basis to apply the treaty and must take the full thirty — which is why the same holding can be taxed at two different rates in two different accounts.
What Miw shows you
Miw does not file anything. What it does is make the rate visible, per country and per year, from the statement you already have:
- Gross dividend income and the tax withheld, grouped by the source country.
- So the effective rate on your US holdings is a division you can do at a glance.
- Year by year, so an expired form shows up as the year the rate changed.
- And the same figures feed Anexo J, where the foreign tax becomes your credit.
Questions
- How do I tell which rate I am on?
- Divide the tax withheld by the gross dividend on a US holding. Around 0.15 means the treaty rate is being applied; around 0.30 means it is not. Miw groups both figures by country, which is what makes that a glance rather than an afternoon.
- I was charged 30%. What now?
- The form lives with your broker, so that is where the question goes — most let you complete it online in a few minutes, and it applies to dividends paid after it is on file. Whether anything can be done about tax already withheld is a matter between you, your broker and the IRS; Miw can show you what was taken, not reclaim it.
- Does this mean I do not declare the dividend in Portugal?
- No. Foreign income is declared either way. The 15% is what the United States keeps; Portugal then taxes the income and the tax already paid abroad supports the credit for international double taxation, which is what Anexo J is for.
Descriptive, not tax advice. Miw reads your statement and shows what was withheld; the form itself is between you and your broker. Confirm your own circumstances with a professional.
More on tax
Start from your broker
The figures come from the statement your broker already gives you — nothing is typed in by hand.