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Old 11-04-2014, 12:41 AM   #18
Shiny Things
Supremacy Member
 
Join Date: Dec 2009
Posts: 8,942
Assuming the ETF pays out 2% in dividends each year (which is a conservative estimate), you are losing 0.6% in performance each year, which is quite significant when compounded over time.
This is being really nitpicky, but you're only losing 0.3% per year. Instead of 30% tax being withheld from the final dividend payment, the ETF pays the tax for you at a 15% rate and reduces the dividends accordingly. You're still paying tax, but you're paying less tax - and you're not getting anything withheld from the dividend payments.

OK, I'm done now, back to normal.
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