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Anonymous
Will there be differences in cost if we buy China etfs from different exchanges?
Example China etf from NYSE vs those that are listed in Hong Kong
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Nicholas Beh
26 Feb 2021
Student Ambassador 2020/21 at Seedly
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It will be more tax efficient to invest into HK-domiciled Chinese ETFs. This is because Hong Kong does not charge withholding tax on dividends. Only the Chinese withholding tax rate of 10% will be charged.
If you purchase a US-domiciled Chinese ETF, your dividends will be doubly taxed, firstly 10% by China and then another 30% by the US. Effectively, that's a 37% withholding tax rate!
Do note that this does not apply to individual Chinese stocks listed in the US, as those are ADRs and thus do not face the same tax treatment as ETFs.