Figures checked on 24 September 2026
The US taxes dividends paid to people who live abroad before the money leaves: withholding tax, 30% by default. Under the UK–US tax treaty, a UK resident's treaty rate is 15%, but only if your broker holds a W-8BEN for you — the US form that says you're not a US person and claims the treaty rate. It lasts until the end of the third calendar year after you sign it, so one signed in 2026 runs out on 31 December 2029. Most brokers ask for it when you first buy a US share and remind you before it lapses.
An ISA doesn't change this: it shelters you from UK tax, not US tax, so the 15% is still withheld. Some pension providers can claim a lower rate under the treaty. Outside a wrapper, US dividends also count for UK dividend tax, and the US tax already withheld can usually be set against the UK tax due on the same dividend. The app records US dividends at the declared amount, before anything is withheld, so what reaches your account is 15% less than it shows — or 30% less without the form — before any currency fee.
Without the form, 30% is withheld and $70 arrives. The app records the $100.
Educational content only. It is not personal financial advice.