Trading US shares

Before you can buy US shares, you need to complete a US tax form and return it to us. You may also benefit, depending on your circumstances, from a reduced rate of withholding tax on US sourced income (such as dividends).

  • When dividends, interest payments or some other types of corporate settlement are made by foreign corporations or governments, Withholding Tax will usually be deducted at the point of payment and paid to the government of the country initiating that payment. The amount of Withholding Tax deducted can differ from country to country and will affect the value of the returns.

    If you receive foreign payments from trading international securities through us, the amount of Withholding Tax you have paid will appear on your consolidated tax certificate, which can be viewed online. If you are not registered online we post this certificate to you at the end of the tax year.

  • The Bank of Scotland Share Dealing Self Invested Personal Pension service is unable to arrange for US sourced income to be paid entirely exempt from tax in the US. Within our SIPP a 30% Withholding Tax rate is applied to all US sourced dividends except where the shares are US listed and you have completed a W-8BEN form when 15% Withholding Tax will apply.

    Other SIPP providers may offer a zero rate of Withholding Tax on US sourced dividends, which means no Withholding Tax is deducted so all of the dividend is received at the gross amount. We do not currently offer this arrangement and do not offer a foreign Withholding Tax reclaim service.

    How this affects your holdings?

    US listed shares

    If you wish to buy US listed shares that pay US sourced dividends we require you to complete a W-8BEN form. Once we have this form we can apply a reduced 15% Withholding Tax rate.

    For example, you would receive $85 on a $100 dividend. Other SIPP providers, depending on their arrangements, may pass on the full $100.

    UK listed shares paying US sourced dividends

    Ordinarily if you complete a W-8BEN form you will only pay the 15% Withholding Tax rate instead of 30% on US listed shares paying US sourced dividends. For UK listed shares paying US sourced dividends a 30% Withholding Tax rate is applied even if you have a W-8BEN form in place.

    For example, you would receive $70 on a $100 dividend. Other SIPP providers, depending on their arrangements, may pass on the full $100.

Completing the appropriate tax form

It is your responsibility to make sure you complete the right form for your circumstances. If you are completing a W-8BEN form, please refer to the ‘How to’ guide first. Further help can be found at www.irs.gov under ‘Forms & Instructions’.

W-8BEN form

A Non-US individual such as a UK resident would ordinarily complete a W-8BEN:

The W-8BEN form is valid for three calendar years following the year in which you sign it, unless your personal circumstances change. Please let us know within 30 days if this happens. We will contact you when your form is due to expire.

UK listed shares paying US sourced dividends

Ordinarily if you complete a W-8BEN form you will only pay the 15% Withholding Tax rate instead of 30% on US listed shares paying US sourced dividends. For UK listed shares paying US sourced dividends a 30% Withholding Tax rate is applied even if you have a W-8BEN form in place.

For example, you would receive $70 on a $100 dividend.

W-9 form

A US person would ordinarily complete a W-9:

Returning the form

Email

IMPORTANT: We can only accept completed forms from the email address you have registered with us.

There are two ways you can email the completed form:

  1. Complete the form and digitally sign (with date and time stamp) and email an electronic copy of the form to us, or;
  2. Complete the form then print, sign, scan and email the form to us.

Please email your completed form to StockbrokingUSTaxForm@lloydsbanking.com. We aim to log all forms within one working day and we’ll text you confirmation when it’s complete.

Print and return by post

Please send your completed form to: Customer Registration Department, Bank of Scotland Share Dealing, Lovell Park Road, Leeds LS1 1NS. The form we receive from you must be completed and signed in pen, and not a copy.

  • We have certain duties to the US tax authority for customers holding US shares and receiving income from the US. We must request and receive documents to comply.

    When you complete a US tax form you may benefit from a reduced Withholding Tax rate. For example, you may be eligible for a reduced rate of 15% Withholding Tax on your US dividends, instead of the standard rate of 30%. This means that you may be able to receive $85 (net) from a gross U.S. dividend of $100, rather than the standard $70 (net).

Risk Warning

Please remember that the value of an investment and the income from it can go down as well as up and you may get back less than you invested.

We don't provide advice so if you are in any doubt about making your own investment decisions we recommend you seek advice from a suitably qualified financial adviser.

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Bank of Scotland | Share Dealing | Trading US shares

Bank of Scotland Share Dealing Service is operated by Halifax Share Dealing Limited. Halifax Share Dealing Limited. Registered in England and Wales no. 3195646. Registered Office: Trinity Road, Halifax, West Yorkshire, HX1 2RG. Authorised and regulated by the Financial Conduct Authority, 12 Endeavour Square, London, E20 1JN under registration number 183332. A Member of the London Stock Exchange and an HM Revenue & Customs Approved ISA Manager.