Guaranteed! Higher aftertax foreign returns

Stephen Everard has discovered a remarkable strategy for obtaining higher returns on foreign investments -- and it’s absolutely guaranteed.

Stephen Everard has discovered a remarkable strategy for obtaining higher returns on foreign investments -- and it’s absolutely guaranteed. What’s his system? Collecting withholding-tax refunds on dividend and interest income. Everard, CEO of Global Operations and Administration, a London custody software boutique, says cross-border investors failed to harvest nearly $7 billion in refunds last year alone.

The 44-year-old former head of Citibank’s global custody operation has been calculating this unclaimed tax haul for the past couple of years. Coincidentally, his firm does tax reclamation for big custody customers. Everard says he wants to “highlight how much money investors are leaving on the table.”

That free money -- for governments, at least -- rose almost 12 percent last year, estimates Everard, who adds that “the amount is increasing.” Of course, international investors may not be as careless as the statistics make them sound. The largest unclaimed taxes per capita turn out to be in tax havens Ireland, Luxembourg and Switzerland. “It’s safe to assume that many of the foreign people operating from fiscally advantaged countries are a lot more worried about their home governments finding out about undeclared income than they are about getting refunds on their withholding taxes,” notes Everard.

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