Tax residency in a territorial country + div-paying stocks in UK which has 0% withholding tax...?

[WorldCitizen99]

Have I got this right?
Let's say I establish tax residency in a territorial tax country in, say, Guatemala.
Then I get an Interactive Brokers account (using Guatemalan residency) and buy dividend-paying stocks on a stock exchange in a country that does not withhold tax on dividends, e.g. UK. (The Deloitte tax sheet says 'dividends from UK companies')
Have I just generated dividend income tax-free or is it subject to the 5% tax on dividends for residents of Guat bc the brokerage acct is based in Guat?

 

[fshore]

WorldCitizen99 said:
Have I got this right?
Let's say I establish tax residency in a territorial tax country in, say, Guatemala.
Then I get an Interactive Brokers account (using Guatemalan residency) and buy dividend-paying stocks on a stock exchange in a country that does not withhold tax on dividends, e.g. UK. (The Deloitte tax sheet says 'dividends from UK companies')
Have I just generated dividend income tax-free or is it subject to the 5% tax on dividends for residents of Guat bc the brokerage acct is based in Guat?
Click to expand...

It's not the stock exchange that matters but where the companies are resident. If you buy UK companies stock then no tax in the UK. Not sure about the details in Guatamala laws.

 

[Sols]

Check with a Guatemalan tax adviser to be sure. But compared to other jurisdictions with similar tax laws and based on how territorial taxation often works, the proposed setup would not be subject to local tax provided that the investments you make are not Guatemalan.

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This is the probably the answer to your question.