First time playing with the tax presets to account for the fact the US withholds 15% of all dividends paid to a non-US resident and I have a bunch of questions:
If I use “if tax type is dividend tax” I get a different result than if I use “if transaction type is dividends” (this one only applies to the most recent dividend distribution). What’s the difference?
Regardless of which one of the two conditions above I use, it only seems to calculate taxes due for this year (2025). Why doesn’t it go back to all previous years and calculate taxes as well?
It seems the preset can only calculate taxes due but not automatically calculate taxes paid; is that correct? Hopefully that’s not the case, as manually having to import all dividend related transactions from my broker to populate the “tax paid” field would be a pain…
Tax presets are meant to calculate the Tax Due, not the Tax Withheld. WHT is meant to be recorded in the “Tax Paid” field - usually imported straight from your broker.
Of course, if your only tax obligation is whatever is withheld, then the tax preset should apply the 15% tax. They’re two separate things.
Now, for you questions:
They actually should match the same, as Dividend Tax is applied only on Dividend transactions
It actually should go back, unless you have an If there that limits the dates. In the Taxes Due Report there’s a year selector, which will hold only the years with at least one tax event.
It is correct. But you might not need to update the tax paid. Capitally uses only Tax Due for taxes. It’s not a sum, but the only value. You record (or import) tax paid, so you can subtract them to know how much tax you still owe. So knowing the Tax Paid is only needed when filing the tax and calculating tax to be paid. But if you know exactly how much was withheld, you can just subtract this from Tax Due yourself.
Could you please send me a sample project with your tax preset and some dividends from this and previous years to support@mycapitally.com ? Can be a single Buy that caused some dividends to pour in, where you can see it doesn’t work as expected.
I checked again, and I DO see taxes due for all relevant years, as long as the tax preset uses “Tax type = dividend tax”. So, to summarize, if the preset I use is “Tax type = dividend tax” it’s properly applied to all tax distributions and I see all the years, but if I use “transaction type = dividends” then it only applies to the last dividend distribution, and of course as a result I only see taxes due for 2025.
I’ll try to send you an extract/sample, as requested.
Once you have some time please send me a sample, as in case of dividends it shouldn’t be any difference between using transaction type and tax type. It doesn’t make any difference on my data as well. I’d love to understand what happened there.
Many thanks for the sample file, it allowed me to figure out what’s going on:
Capitally has a concept of “virtual” transactions - ones that are not imported by the user, but created automatically - like Dividends.
The Transaction type property was only looking at the user’s transactions. In your case, only the latest dividend was in the state (either you created it manually, or edited an automatic one), all the rest was virtual. That’s why it didn’t work.
I’ve fixed it and it will be available in version 2.1.0.
But in general, I’d recommend to compare the “Tax type” as it’s more suited for this purpose, and only check Transaction type if you need to differentiate within - especially for Buy/Sell