If Switzerland withholds 35% from your dividend and the treaty says you owe 15%, the extra 20% is your money sitting in Bern. The IRS won't give you a credit for it, so the Swiss government is the only place to get it back. Whether that's worth doing depends almost entirely on how much is at stake and how your shares are held.
Relief at source vs. reclaim
There are two ways to end up paying only the treaty rate:
- Relief at source. The correct rate is applied when the dividend is paid. You receive more money immediately and have nothing to file. This depends on your broker, custodian, or ADR depositary certifying you as a U.S. resident before the payment.
- Reclaim (refund). The full statutory rate is withheld, and you or an agent later file with the foreign tax authority for the excess. This is slower, involves documents, and sometimes costs money.
Relief at source is always preferable. Reclaim is the fallback. For background on why over-withholding happens, see foreign dividend withholding.
ADR tax relief programs
Depositary banks for ADRs of high-withholding countries often hire a tax relief agent, such as GlobeTax or Acupay, to run relief-at-source and reclaim services for ADR holders. Your broker submits your residency through DTC before a cutoff date, and the agent handles the foreign filing.
The Nestle ADR program, run by Citibank with GlobeTax as agent, illustrates how this works. For the 2025 dividend, DTC's notice described:
- Relief at source for eligible U.S. holders, with a fee of up to $0.0075 per ADR.
- A long-form reclaim option after the fact, with a fee of up to $0.01 per ADR, filed in annual batches over the following years.
- A note that P.O. box and "care of" addresses aren't accepted as proof of U.S. residence.
These programs are the most practical route for small ADR investors. If you're over-withheld on an ADR, ask your broker whether it participated in the depositary's program for that dividend and whether a long-form claim is still open. Fees and deadlines vary by program; the depositary's DTC notice for each dividend sets them out.
Key point
For ADRs, you usually don't file with the foreign government yourself. The depositary's agent does it, if your broker submits your information on time.
How direct reclaims work in three countries
If you hold foreign ordinary shares, or the ADR program doesn't help, a direct reclaim is the remaining option. The basic ingredients are similar everywhere: proof of U.S. residence, proof of the dividend and the tax withheld, and the country's form, filed before its deadline.
Switzerland
Switzerland's 35% statutory rate on dividends is reduced to 15% for U.S. portfolio investors under the treaty, and relief is generally granted by refund. The Swiss Federal Tax Administration (FTA) accepts applications from foreign residents of treaty countries through its online service or on its official forms. Each claimed dividend must be backed by a revenue statement or securities list; if a non-Swiss bank held the shares, you also need tax vouchers confirming the tax was remitted to the FTA. Claims are generally accepted once a year per person, refunds are paid in Swiss francs, and the right expires three years after the end of the calendar year in which the dividend fell due. See investing in Switzerland.
Germany
Germany withholds 25% plus a 5.5% solidarity surcharge on that tax. Refunds of the excess over the treaty rate go through the Federal Central Tax Office (BZSt) and must be filed electronically on the official form through its online portal. You need a residence certificate from your tax authority and a tax certificate from the German bank or securities firm that paid the dividend; a dividend statement from a foreign custodian doesn't qualify. The general deadline is four years after the end of the calendar year in which the income accrued. See investing in Germany.
France
France offers both routes. For relief at source, a shareholder submits Form 5000 (a residence certificate stamped by their home tax authority) to the paying institution before the dividend. For a refund, Forms 5000 and 5001 go to the French tax service for non-residents, stamped by the paying institution and your tax authority, by December 31 of the second year after the dividend was paid. See investing in France.
Proving U.S. residence: Form 6166
Most direct reclaims need an official certificate of U.S. tax residence. The IRS issues it as Form 6166 after you file Form 8802. The user fee for individuals rose from $85 to $105 for applications postmarked on or after October 1, 2026. Processing takes weeks, so build that into any deadline.
When it's worth it for a small investor
Add up the actual costs before starting:
- The Form 8802 fee for a residency certificate, if the country requires one.
- Any fee your U.S. broker charges to produce dividend tax vouchers or certifications, which some charge and some don't provide at all.
- Foreign bank charges on a refund paid in francs or euros.
- For ADRs, the depositary agent's per-ADR fee and any minimums.
- Your time, which can be several hours the first time.
Worked example
You own 300 shares of a Swiss company paying the equivalent of $2.50 per share, or $750 a year. Over-withholding at 20 points costs you $150 a year. A direct Swiss claim covering one year would require the residency certificate ($105) plus documentation and currency conversion, leaving perhaps $30 or less. Waiting and filing three years at once, within the deadline, would recover about $450 for the same certificate fee, which changes the math. Better still, an ADR relief-at-source program at a fraction of a cent per ADR would save nearly the full $150 each year with no filing at all.
Rough guidance: claims under a couple of hundred dollars rarely justify a direct filing. Larger, recurring positions do. For anything in between, the depositary program or a broker that applies relief at source is usually the efficient answer, and a holding that repeatedly comes in over-withheld may be cheaper to hold in a different form.
Watch out
If you claimed the full over-withheld amount as a foreign tax credit on a past return, a refund from the foreign country means you overclaimed. Publication 514 requires you to reduce the credit for the year it was taken. A tax professional can tell you how to correct it.
Common questions
Can I just claim the over-withheld amount as a U.S. foreign tax credit instead?
No. The IRS treats tax you could have had refunded, such as withholding above the treaty rate, as not creditable. The only way to recover it is from the foreign country.
How long do I have to file a Swiss reclaim?
The Swiss Federal Tax Administration says a refund claim expires if not filed within three years after the end of the calendar year in which the dividend fell due.
Is a reclaim worth it on a small position?
Often not. Between the U.S. residency certificate fee, foreign bank or agent charges, and your time, a claim of under a few hundred dollars may net little. Check first whether your ADR program offers relief at source, which is cheaper.
Sources
- Swiss Federal Tax Administration: Claim to refund of Swiss anticipatory tax
- German Federal Central Tax Office (BZSt): Capital yield tax refund procedure
- TotalEnergies Shareholder's Guide 2025: French withholding tax and forms 5000/5001
- DTC Important Notice B#21889-25: Nestle ADR tax relief (Switzerland)
- IRS: Form 8802 user fee fact sheet
- IRS Publication 514, Foreign Tax Credit for Individuals
Educational content only, not investment, tax or legal advice. The Stateside Report does not recommend buying or selling any security. Tax rules depend on your situation; confirm with a qualified tax professional. Full disclosures.