Tax drag

Withholding Tax Calculator

Investing from outside the US? The same S&P 500 can lose more or less to US dividend tax depending on where the fund is based. See what that costs you.

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yrs
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What the US withholds from your dividends if you hold a US fund directly. 30% by default; often 15% if your country has a tax treaty with the US.
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Set by the US–Ireland treaty. The same for every investor, wherever you live.
Currency

After 25 years

You: 30% · Irish fund: 15%
CSPX · Ireland
$524,262
Tax 0.2% + fee 0.07% a year
VOO · United States
$510,432
Tax 0.39% + fee 0.03% a year
Withholding tax cost · CSPX
$18,014
Withholding tax cost · VOO
$35,626

CSPX ends $13,829 ahead. Lower withholding tax (0.2% vs 0.39% a year) outweighs its slightly higher fee.

Total yearly drag: CSPX 0.27% · VOO 0.42%.

Both funds over time

Hover or tap the chart for any year
CSPX balanceYour contributionsVOO
$0$150k$300k$450k$600kNowYr 2Yr 4Yr 6Yr 8Yr 10Yr 12Yr 14Yr 16Yr 18Yr 20Yr 22Yr 25

Same 8% return for both, minus each fund's fee and its withholding tax on US dividends. Dividends assumed reinvested.

Which wins at your tax rate

VOO at each withholding rate vs CSPX at 15%
Your US rateVOO ends atCSPX ahead byBetter choice
0%$546,058−$21,797VOO
10%$533,875−$9,613VOO
15%$527,900−$3,638VOO
20%$522,002+$2,259CSPX
25%$516,180+$8,082CSPX
30% (yours)$510,432+$13,829CSPX

Irish or US-domiciled: the short answer

With $10,000 plus $500 a month for 25 years in the S&P 500 at 8%, and a 1.3% dividend yield:

  • CSPX (Ireland, 15% at fund level, 0.07% fee): about $524,262.
  • VOO with no tax treaty (30%, 0.03% fee): about $510,432 — $13,829 less.
  • VOO with a 15% treaty rate: about $527,900 — slightly ahead, thanks to its lower fee.

So Irish-domiciled funds clearly win when your country has no US tax treaty. With a 15% treaty, the tax is similar and the decision comes down to fees, estate-tax exposure and what your broker offers.

How this calculator works

yearly tax drag = dividend yield × share from US companies × withholding rate

Both funds get the same return. Each loses its fee and its tax drag every year. The Irish fund pays the treaty rate on US dividends; the US fund pays your personal rate. Dividends from non-US companies can face their own withholding in both structures, so they're left out.

Related comparisons

Frequently asked questions

What is dividend withholding tax?

Tax taken at source by the country where a company is based, before its dividend reaches the shareholder. For US shares held by non-US investors, the US withholds 30% by default, often reduced to 15% under a tax treaty.

Why do Irish-domiciled ETFs pay less?

Ireland has a tax treaty with the US, so US dividends paid to an Irish fund are generally taxed at 15% at fund level. That rate applies regardless of where the fund's investors live, and Ireland generally doesn't add its own tax on payouts to non-resident investors.

Does my country have a tax treaty with the US?

Many do, but not all — the UAE, for example, has no income tax treaty with the US, so the default 30% applies to US funds held directly. Check your country's treaty and claim it with your broker (usually via form W-8BEN).

What about US estate tax?

Non-US investors holding US-domiciled assets, such as VOO, can face US estate tax on holdings above a low threshold ($60,000) if they die. Irish-domiciled funds are generally not US assets for this purpose. This calculator doesn't model it, but for many non-US investors it matters more than withholding tax.

Is this tax advice?

No. It's a simplified model of one tax effect, using rates you choose. Your personal taxes on dividends and gains depend on where you live — check with a tax professional for your situation.