US NYSE REIT

[lakedaemonian]

I'm inquiring to see if anyone here has ever purchased shares in an NYSE or NASDAQ US based Real Estate Investment Trust(REIT).

The reason I'm asking is the following:

I have identified an equity I believe has some potential:

NYSE symbol: SAX

It is currently producing a dividend of approximately 16%

Assuming I purchase it, and assuming the NZ Dollar continues it's likely fall to say 0.60, the result is a dividend yield of 18%(assuming the dividend distributed stays the course).

It would appear the US withholds 30% of the dividend distributed as tax to Non US shareholders.

My questions is how will the NZ IRD look at this?

Will the Tax Treaty that exists between the US and NZ prevent double taxation resulting in taxation of only 3% to the IRD?

Or am I looking at the US IRS getting their 30% and THEN the IRD getting their 33%?

What am I left with?

Assuming no double taxation it could potentially produce quite a tidy aftertax yield before accounting for any potential capital gain in the share price.

Any shared knowledge or experience is appreciated......if it doesn't work out to be a worthwhile investment, at least it could prove to be a valuable learning experience.

[Snapper]

As the US is on the grey list then any tax paid there is taken into account here. I'll qualify that by saying that if you're on a 19.5 % marginal tax rate then you can only claim the overseas tax paid up to that marginal tax rate. ie if you get a $100 gross dividend with $30 withholding tax deducted then you can only claim a tax credit of $19.50. In your case, you're correct - you would only have to pay $3 to the NZ IRD.