Foreign Dividends with No Withholding Tax – Companies List

Last Updated: November 25, 2019

Usually, there’s a non-resident withholding tax on dividends paid by foreign companies. Canadians earning U.S dividends in their non-registered (taxable) accounts will automatically get 15% deducted. However, they can recover that by filing for a foreign tax credit. However, at the end of the day, they still pay the marginal income tax rate on those foreign dividends.

To save taxes on foreign dividends, Canadians can buy U.S. dividend stocks in an RRSP instead. However, the point of this article is to record the list of companies which don’t have a withholding tax on the dividends for non-residence.

Here’s a list of companies which do not have withholding taxes on the dividends for Canadians. That means, if you’re holding these dividend companies in an RRSP or TFSA, you receive the full dividend.

If you like these companies, buy them in your TFSA or RRSP, and receive their full dividend. Because you get deducted 15% on U.S. dividends in a TFSA but get the full dividend in an RRSP, you probably want to leave the room in your RRSP for U.S. dividend companies with high yields.

  • BP plc (NYSE: BP) – *yield: 6.4% – an Energy company
  • Unilever plc (NYSE: UL) – *yield: 3.1% – a Consumer Staple
  • Westpac Banking Corp (NYSE: WBK) – *yield: 11.2% – an Australian bank
  • BHP Billiton plc (NYSE: BBL) – *yield: 6% – a Basic Materials company
  • GlaxoSmithKline plc (NYSE: GSK) – *yield: 4.5% – a pharmaceutical company
  • HSBC Holdings plc (NYSE: HSBC) – *yield: 6.8% – a London-based bank doing business in 66 countries
  • Vodafone Group plc (NASDAQ: VOD) – *yield: 4.8% – a Telecom

*yield as of November 25, 2019. Note that I collected this list from the web, so there could be inaccuracies. Please let me know if any correction is needed. I will also add to this list as I come across such companies.

Foreign dividend risks

The fluctuating foreign exchange rate between the currency of the company and your currency will result in a fluctuating income for you. From 2014 to 2016, we also saw the horror of investing in resource-based companies as the commodity prices experienced a landslide.

It goes without saying that whether you’re investing for foreign dividends or not, the fundamentals and growth prospects of the company must be good. It’s probably wise to only invest in resource-based dividend stocks with a huge margin of safety because of the nature of their cyclical businesses.

Country Withholding Tax on Dividends (%)
Argentina 0
Brazil 0
Hong Kong 10
Hungary 0
India 0
Ireland 20
Mexico 0
Singapore 0
South Africa 0
United Kingdom 0
Venezuela 0

original data source

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Disclosure: I don’t own any shares of the mentioned companies.

Disclaimer: I am not a certified financial advisor. This article is for educational purposes, so consult a financial advisor and or tax professional if necessary before making any investment decisions.

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6 thoughts on “Foreign Dividends with No Withholding Tax – Companies List

  1. Bernie

    I believe Ireland has, or did have, a 20% withholding tax on their stocks as I experienced this in 2009. The linked writer may have been referring to Northern Ireland which is actually UK. It should be noted that your list is not complete as there are many other stocks in the UK, Australia & in the other noted countries that don’t withhold tax. Two popular ones that come to mind are Vodafone & HSBC Holdings.

    Thanks for your article.

  2. Wealth Builder

    As a Canadian citizen ,I am holding KMI in my TFSA and still 15 % withholding tax is deducted.Do you think it should not be deducted?

    1. Passive Income Earner Post author

      Wealth Builder, TFSA is not a registered account so all US dividends received in there will get at least 15% deducted. Because there’s a tax treaty between the US and Canada, if you bought KMI in your RRSP, you shouldn’t get 15% withholding tax on your KMI dividends. I have some KMI shares in my RRSP account and I get the full dividend.

      Hope this helps,
      Passive Income Earner

  3. Ian

    Don’t forget Colombia, another 0% nation with CIB and AVAL. AVAL, with the 5% monthly-pay dividend is a nice one in particular.

  4. androidjago

    For the average Canadian investor, HXS is likely the only practical way to gain exposure to dividend-paying foreign stocks in a TFSA without the drag of foreign dividend withholding tax. Gail Bebee is Canada’s independent voice on personal finance and author of No Hype –The Straight Goods on Investing Your Money, a popular book of investing basics for Canadians from a financial industry outsider viewpoint.

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