.......As for WBC, looking back, it's been a good company to hold over many years - I've long since had my investment back in tax-free dividends.......
I hold on the Australian share register where full franking credits means no non-resident withholding tax is deducted when dividends are paid + I live in Hong Kong where dividends are not taxed (a simplified approach to the principle of no double taxation).
Realistically you could add inflation to GDP from an expected capital growth perspective taking potential returns past 10% pa on current prices and sensible gdp/inflation estimates.
There is however downside risk while the current negative trend exists.
If I could get 10% pa after tax notional returns in an environment where inflation is around 3%, I'd be queuing up all day long to buy.
I've not owned WBC before and notice that even though I bought these on the NZX, the dividend is paid in Australian dollars. I'm assuming that no NZ tax is deducted so I'd be grateful if somebody who is holding these could advise what I need to do to satisfy NZ tax obligations. Thanks.
I've not owned WBC before and notice that even though I bought these on the NZX, the dividend is paid in Australian dollars. I'm assuming that no NZ tax is deducted
You assume incorrectly. Westpac dividends have had associated NZ imputation credits (to a limited degree) for several years now. You can claim these imputation credits as tax paid in New Zealand on your New Zealand income. However these imputation credits are not paid to 28% and are insufficient to extinguish your NZ tax obligations on the whole Westpac dividend.
so I'd be grateful if somebody who is holding these could advise what I need to do to satisfy NZ tax obligations. Thanks.
As an NZ taxpayer you are not allowed to claim Australian Franking Credits. So when you get your dividend statement and it shows your Net Income in Australia (with franking credits deducted) then this becomes your Gross Income in New Zealand. Enter this gross income you get from Australia alongside any associated Aussie withholding tax paid if any (which perversely you are allowed to claim as tax paid for NZ purposes) in your 'overseas income' section of your NZ tax return.
SNOOPY
discl: WBC shareholder on the NZ Register.
Last edited by Snoopy; 16-11-2018 at 10:51 PM.
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You assume incorrectly. Westpac dividends have had associated NZ imputation credits (to a limited degree) for several years now. You can claim these imputation credits as tax paid in New Zealand on your New Zealand income. However these imputation credits are not paid to 28% and are insufficient to extinguish your NZ tax obligations on the whole Westpac dividend.
As an NZ taxpayer you are not allowed to claim Australian Franking Credits. So when you get your dividend statement and it shows your Net Income in Australia (with franking credits deducted) then this becomes your Gross Income in New Zealand. Enter this gross income you get from Australia alongside any associated Aussie withholding tax paid if any (which perversely you are allowed to claim as tax paid for NZ purposes) in your 'overseas income' section of your NZ tax return.
SNOOPY
discl: WBC shareholder on the NZ Register.
Thanks very much for your response Snoopy and for providing such clarity. Much appreciated :-)
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