# Russian ADR and tax implications



## twowheeled (Jan 15, 2011)

I'm wondering if anyone has experience owning any Russian ADRs of such companies as Gazprom, Lukoil, Sberbank, etc?

I'm considering purchasing some but unsure of what account makes the most sense to hold them in. I read a few articles online that mention withholding taxes on the dividends. Is it correct that since the dividends cannot be tax sheltered they should be held in non-registered accounts? Are there any good articles to understanding foreign withholding taxes, and tax credits? It is difficult to find advice written for a Canadian investor.

For example Lukoil is paying close to an 18% dividend at the moment.


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## Eclectic12 (Oct 20, 2010)

These articles use ETFs as examples with mentions of stocks.








Foreign Withholding Tax Explained | Canadian Couch Potato


The Couch Potato strategy calls for a significant allocation to US and international stocks. When you live in a country with a small, poorly diversified stock market…



canadiancouchpotato.com












Foreign Withholding Taxes Revisited | Canadian Couch Potato


Justin Bender and I have just completed the second edition of our popular white paper, Foreign Withholding Taxes: How to estimate the hidden tax drag on US and international equity ETFs.



canadiancouchpotato.com












The True Cost of Foreign Withholding Taxes | Canadian Couch Potato


Back in the fall of 2012, I wrote a pair of blog posts about the impact of foreign withholding taxes in US and international equity funds. The first explained the general idea of this tax on foreign…



canadiancouchpotato.com





Info on Foreign Tax Credit








TaxTips.ca - Foreign Tax Credit


TaxTips.ca - Foreign non-business income tax, foreign tax credit and related deductions, some of which may not be automatically done by your income tax software




www.taxtips.ca






https://www.cibc.com/content/dam/personal_banking/advice_centre/tax-savings/doing-it-right-en.pdf










Foreign withholding tax: Is the credit always worth it? | Advisor's Edge


Comparing tax options for foreign dividend-paying stocks




www.advisor.ca






Cheers

*PS*
IIRC, some articles say that the ADR company does not know the owner's tax residency so the maximum WHT is taken, whether or not a tax treaty provides a reduced WHT.


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