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Withholding Tax Impact: US vs Irish UCITS

The VOO vs CSPX question, quantified: how much does US dividend withholding really cost you as a non-US investor?

Your situation

Your country's US tax treaty
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years

Market assumptions

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Beyond dividends: US estate tax

US-situs assets above $60,000 can be exposed to US estate tax of up to 40% for non-resident aliens. Irish UCITS are not US-situs assets. For large portfolios this often matters more than the dividend math — it is a key reason many international investors choose UCITS regardless of the drag comparison.

The Irish UCITS route ends ahead by $9,735$50,000 · 25 years · 30% vs 15%

US-listed (VOO-style)

Final value$263,865
Withholding drag−39 bp/yr
Lost to withholding$25,155

Irish UCITS (CSPX-style)

Final value$273,600
Withholding drag−19 bp/yr
Lost to withholding$12,738

Value over time

Methodology & assumptions

US-listed route: you receive dividends net of your personal US withholding rate and reinvest them. Irish UCITS route (accumulating): the fund receives US dividends net of the 15% US–Ireland treaty rate and reinvests internally; no further US withholding applies to you. Both deduct their TER annually. Taxes in your country of residence apply to both routes and are excluded. Constant yields and returns are simplifications for comparability.

Educational tool — not tax advice. Treaty rates vary by country and personal situation; confirm with a tax professional.

💬 Frequently Asked Questions

The US withholds tax on dividends paid to foreign investors: 30% by default, reduced to 15% if your country has a tax treaty with the US (for example Chile since 2024, Mexico, or Spain). It applies to dividends from US-listed funds like VOO — not to your capital gains when you sell.
Ireland's tax treaty with the US sets a 15% rate on dividends the FUND receives from its US holdings. An accumulating Irish UCITS then reinvests internally with no additional US withholding on you. If you personally face 30%, the Irish route roughly halves the dividend tax drag.
Usually yes, slightly: same 15% withholding either way, but US-listed funds tend to have lower TERs (VOO 0.03% vs CSPX 0.07%) and tighter spreads. The estate-tax exposure of US-situs assets above $60,000 can still tilt large portfolios toward UCITS.
This tool isolates the US withholding layer, which differs between the two routes. Your residence-country taxes on dividends and gains apply to both and depend on local law — check whether you can credit the US withholding against local tax, and consult a professional.

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