US Dividends Query

[Decker]

This is somewhat OT but I wondered if anyone is familiar with the ramifications of dividend payments in the US - specifically to a non-national?

[Scrooge]

Don't you have to claim that on your UK taxes as over seas earnings?

[Decker]

Well there's a Dual Taxation Agreement in place. I'm more interested in what it means to the issuing company vis a vis tax liabilities etc.

[RichardMannion]

I know for my US stock holdings dividends are taxed as per normal at UK rates, I have a W8BEN in place.

Thanks,
Richard

[mcmbenjamin]

Grr. Could this be a dividend or partnership draw or income to a British company from a US company?

[Decker]

The former. The latter we treat as a payment to a subcontractor so it comes straight off the US bottom line and onto the UK bottom line. Part of the query was whether that US company would have to take a withholding tax and part of it was whether any state taxes applied. In the UK when salary is paid the government is paid about 13% of the salary for "National Insurance" (NI). When dividends are paid no NI is due from the company. I'll be running this by an accountant next week - just wondered if anyone had experience of it