Owning US stock in UK ISA dividend payments

If I have a UK ISA with Trading 212 and I own US stocks that pay dividends, what can I expect in fees for each dividend payment?

I know it’s an ISA so technically there shouldn’t be any tax from the UK side.

Exchange rate and Withholding Tax

Withholding Tax on Dividend 15%

AFAIK, there is no way around it.
But keep in mind the trade off here is that, when you buy US stock you do not pay stamp duty like when you buy the UK stocks

The way around US withholding tax is to put your US dividend stocks in a SIPP (specifically a SIPP provider which claims the full 30% exemption)


@ TInvest
Would you be more specific about this please.
Trading 212 is in the way of offering SIIP. I know Freetrade has already offered a low cost SIIP account especially for people intending to trade individual stocks, ETF within SIIP account.
I have US Stocks VALE, ZIM which while fundamentally sound (at least what I believe) they are also paying a very good dividend. Could I avoid that using Freetrade. If not which SIIP provider do you recommend ??

Article above has more detail. Can’t really comment on which providers do or don’t claim it as I haven’t fully researched but from what I gather most of the bigger firms do. I suspect the newer ones who don’t now maybe will over time.

Personally, given the very long term nature of it, I’d be inclined to go with a more established company for a SIPP anyway.

T212 is great and is my main account (GIA/ISA) at the moment (secondary accounts with FT, HL) but long term I’d like to diversify my brokers as well as my investments. Spreads the risk in the event of anything major going wrong with one of them. Probably IB/T212 for ISAs, HL for LISAs, IB/II for SIPP, T212/FT for GIA - what suits you best will depend on asset mix/value and transaction frequency.

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So dividends DO incur the FX fee?

I don’t understand, here it says:

*FX Fee will not apply for payments arising from corporate events such as dividends

No, dividends do not incur FX fees.
Initially when the fee was first introduced it did for a little while, but this was quickly removed.


For individual share is it possible to automatically reinvest this dividend to avoid paying withholding Tax on Dividend ?

No. Withholding tax is always taken out, even when using a SCRIP program from the company (being issued a share dividend instead of cash).

Certain countries have no withholding taxes (such as the UK), or certain corporate structures (such as MLPs in the US).


Not sure you can do it that way. See, you have to pay that withholding tax as you are outside of the US.
Btw, for some UK stocks, ISA or non-ISA there is a stamp duty tax as well :upside_down_face: