Withholding = Gross dividend × Withholding rate (e.g. 15% under the Canada-US treaty)
A foreign government skims withholding tax off dividends before they reach you.
What it is
Withholding tax is an amount a paying country automatically subtracts from investment income, such as dividends, before it is sent to an investor in another country. The standard US rate on dividends paid to foreigners is 30%, but tax treaties reduce it; under the Canada-US treaty the rate on US dividends paid to Canadians is generally 15%. The investor receives the income net of this deduction.
Why it matters
Withholding tax directly lowers your real dividend yield on foreign stocks, and the impact depends on what account you hold them in. A key pitfall for Canadians is that the 15% US withholding on dividends is waived inside an RRSP (a retirement account) but is not recoverable inside a TFSA (a tax-free savings account), so account choice changes your after-tax return.
How it's calculated
It is the applicable treaty or statutory rate multiplied by the gross dividend or interest amount, deducted by the payer before you are paid.
How Quintarthai uses it
Quintarthai shows dividend yield in the Summary key-metrics grid on each stock's company page; that figure is the gross yield before any withholding tax your account may incur.
Cross-border note. Canada-US treaty: US dividends paid to a Canadian face 15% withholding, eliminated in an RRSP but not in a TFSA, while Canadian dividends paid to US investors face 15% Canadian withholding under the same treaty (versus the 25% Canadian domestic rate).
FAQ
Can I get withholding tax back?
Sometimes. In a taxable account you can often claim a foreign tax credit to offset it, but in a TFSA the US withholding on US dividends is generally lost and cannot be recovered.
Does withholding apply to capital gains?
Generally no; cross-border withholding usually applies to income like dividends and interest, not to capital gains on selling shares, though your home-country tax on gains still applies.
Check your understanding
A Canadian investor wants to minimize tax on US dividend stocks. Under the Canada-US treaty, which account avoids the 15% US dividend withholding tax?
The Canada-US treaty waives the 15% US withholding on US dividends inside an RRSP, while in a TFSA it applies and cannot be recovered.