Double taxation

Two countries taxing the same profit

In detail

A dividend from a foreign share is taxed first where the company is, and then again at home. Left alone, the same profit is taxed twice. Most countries soften this through credits or tax treaties.

Example

A $100 dividend is taxed 10% abroad, leaving $90; a further 20% at home leaves $72.

Differences by country

Japan — In Japan a US dividend loses 10% abroad and is then taxed at 20.315% (as of 2026).

South Korea — Under the Korea–US tax treaty, the US may tax dividends paid to Korean resident individuals at no more than 15%. Korea computes its 14% withholding and subtracts the foreign tax paid, so nothing more is withheld when 15% was taken in the US (as of 2026).

Related terms

Foreign tax credit Foreign stocks Dividend tax

Read in the app (App Store)

For learning, not investment advice. Decisions are your own.