For many South African funds, dual-listed shares form the backbone of offshore equity exposure. As such, they continue to represent a core area of withholding tax leakage, especially for collective investment schemes (CIS).
With dividend patterns shifting and reclaim procedures evolving, we share a focused look at the trends we're seeing across key dual-listed issuers and what they mean for withholding tax recovery today.
How Dual-Listing affects Taxation of Dividend Income?
Issuer Trends: What We’re Seeing Now
The Value of Reclaiming: What’s at Stake?
Why This Matters for SA Investors
Dual-listings allow South African investors to hold international equities without needing foreign custody accounts.
From a tax recovery perspective:
Did You Know?
South Africa does not impose its own withholding tax on dividends from dual-listed shares, but the foreign WHT can be as high as 35%. That makes the reclaim process a critical component of post-dividend value recovery, especially for large portfolios.
Several dual-listed issuers appear in South African portfolios, but Richemont and Anheuser-Busch InBev (ANH) continue to drive the most meaningful reclaim activity.
Richemont has historically been a strong contributor to reclaim volumes, thanks to consistent special dividends in prior years. In both 2022 and 2023, the company declared a CHF 1.00 special dividend in addition to its ordinary payout. In 2024, no special dividend was declared. This resulted in a 21% reduction in total dividend payout compared to the prior year and a corresponding drop in reclaimable tax.
Administrative complexity for reclaims has also increased. The Swiss tax authority has withdrawn the simplified reclaim procedure that had been in place for South African CIS vehicles. These structures are now marked as “contentious,” which means claims must follow a revised, more stringent submission process. WTax is currently testing alternate approaches with the Swiss authorities and will share updates once meaningful feedback is received.
ANH has continued to raise its dividends per share year on year. This trend has translated into steadily increasing reclaim value for South African investors.
For widely held dual-listed shares, the difference between reclaiming and not reclaiming foreign withholding tax can be substantial. Here's an illustrative comparison using typical tax rates and portfolio exposures:
|
Issuer |
Home WHT Rate |
Treaty Rate |
Dividend (per share) |
Holding Value |
Reclaimable Amount |
If Not Reclaimed |
|
Richemont (CH) |
35% |
15% |
CHF 2.75 |
ZAR 100 million |
ZAR 3.2 million |
Lost to tax leakage |
|
ANH (BE) |
30% |
15% |
EUR 1.00 |
ZAR 100 million |
ZAR 1.5 million |
Lost to tax leakage |
These figures are simplified and illustrative, but they highlight a core point: without an active reclaim process, a significant portion of dividend income remains unrecovered.
For many South African funds, dual-listed shares represent their full cross-border reclaim exposure. Understanding where value is increasing and where administrative changes may create delays or bottlenecks, is essential.
WTax actively monitors these dynamics and helps clients adjust reclaim strategies accordingly.
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Key points to watch:
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Changes in the treatment of CIS claims in Switzerland have introduced new challenges for South African investors, but WTax continues to engage directly with tax authorities to test new approaches as we have successfully done for many foreign domiciled funds over the years. Our clients benefit from early insight into these developments as well as many years of WTax managing similar issues for hundreds of investment fund structures globally.
If you're a South African investor holding dual-listed shares, now is a good time to assess whether you're making the most of your reclaimable value.
Request Our Full Dual-Listed Issuer Summary:
We’ve compiled a current summary of all applicable issuers. Request a copy here.