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Royal Dutch Shell plc Message Board

  • taxquestion17 taxquestion17 Sep 5, 2013 1:11 PM Flag

    ADR dividend payments and ADR fees

    Since RDS-A is an ADR I was thinking someone could answer this question.

    This is a question for anyone that has owned an ADR with a dividend.

    I have a question about ADR (American Depository Receipt) fees.

    It is my understanding ADR fees are deducted from the dividend payments.

    Does an investor receive the dividend payment net the ADR fee (i.e. with the ADR fee already deducted) or is the full dividend received and is there a line item deduction?

    I am asking this question for tax purposes. If the answer is the latter, can the ADR fees be taken as a tax deduction?

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    • I can answer part of your question...I receive the full dividend as a line item and then there are separate line item deductions for taxes (Dutch gov. tax on rdsa dividend) and for the fees (which are a relatively small amount).

      Logically, the fees should be deductible (but only if you hold the ADR in a non-retirement account - cannot deduct fees or taxes paid from a retirement account). As to whether a specific individual can deduct the fees, best to consult with a tax adviser...

      Separately, since the gov (US/Dutch) have made it so very difficult to avoid the 15% Dutch tax on RDS-A dividends (even with a Dutch Qualification Letter), I have abandoned the fight and will take future dividends in script (doing so avoids the 15% tax - according to Fidelity). Will still have to go through all the hassle (filing forms and an $85 fee) to recover the taxes that I have paid so far this year.

 
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