UK investors face double taxation when purchasing STRC, and 21Shares ETP may be a better alternative

By: rootdata|2026/03/31 09:42:00
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Strategy's preferred stock STRC landed on the UK trading platform Trading 212 on March 30, with an annualized yield of approximately 11.5%. However, UK investors holding STRC directly may face significant tax pressure. In the US, STRC's monthly dividends are classified as Return of Capital (ROC) and are not taxable; however, UK brokers typically classify them as foreign dividends, subject to income tax at the marginal dividend tax rate, with the basic rate taxpayer rate at 8.75% and high earners up to 39.35%. Additionally, capital gains tax (CGT) must be paid upon sale, resulting in an estimated actual net yield of only about 10%.

Crypto analyst James Van Straten suggests that UK investors consider the 21Shares Strategy Yield ETP listed on the European exchanges in Amsterdam and Paris instead. This product has a zero management fee, employs an accumulating structure, and automatically reinvests earnings rather than distributing cash. Upon sale, it typically only incurs CGT, with no income tax burden, providing significantly better tax efficiency.

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