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Foreign Stock Dividends

Taxable ?

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Are foreign stock dividends taxable in the UK?  Do they need to be entered on UK tax return?  Thanks

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By sarahg
07th Sep 2021 10:42

I would recommend reading the double tax treaty

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Replying to sarahg:
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By More unearned luck
07th Sep 2021 11:27

In which article of the OECD model tax convention (and hence most actual conventions) is the treatment of stock dividends to be found?

The question the OP asks must frequently crops up with Santander shares as that bank frequently alternated between scrip and cash dividends.

A more useful answer is to advise the OP to look in the notes to the foreign pages of the tax return, wherein he will be told to exclude stock dividends. The corollary of this is the the value of the shares received is not allowable expenditure for CGT.

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By jonharris999
07th Sep 2021 11:18

It depends on the treaty, and then often on the person's residence status and sometimes also the type of stock.

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By OS200
07th Sep 2021 11:38

Thanks to those who have taken time to reply. I am dealing with a UK resident with Iberdrola (Scottish Power) scrip dividends. I would of course refer to the DTA for issues relating to tax credit etc. However, HMRC 'Foreign Notes' (FN7) states 'Do not Include...... stock dividends or bonus shares from a stock dividend issue made by a foreign company'. This would lead me to believe that the scrip dividends are not taxable in the UK. I was looking for confirmation of my understanding......

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Red Leader
By Red Leader
07th Sep 2021 15:44

It might be more useful to read the company's notes regarding the UK taxation of the dividends.

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By Tax Dragon
07th Sep 2021 17:19

Have a think about (by which I mean look up) the (domestic... not sure where DTA comes into it, Sarah, Jon?) provision that makes stock dividends taxable.

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