What is withholding tax?

Withholding tax is a tax deducted from certain investment income before it is paid to you. In an investment context, this commonly applies to income such as dividends and interest.

When you invest through Moneybase, withholding tax may apply depending on the type of instrument you hold and the country from which the income is paid. This means the amount you receive can be lower than the gross dividend or interest payment announced.

For some instruments, Moneybase allows you to manage whether withholding tax is deducted on future interest payments through the app. Any change applies only to future payments and cannot be backdated.

For US stocks, dividends are generally subject to withholding tax. For Maltese residents, this may be reduced from 30% to 15% where a valid W-8BEN form is in place under the US-Malta tax treaty.

Please note that withholding tax treatment depends on your tax residency, the investment product, and the rules of the source country. Moneybase does not provide tax advice, so if you are unsure how withholding tax applies to you, you should speak with a tax advisor.