What are the tax implications for US and international investors?

Tax implications

U.S. investors – The cash dividend from Jianpu Technology (OTCQB: AIJTY) is a foreign‑source payment and is subject to a 30 % Chinese withholding tax on the gross amount. Because the People’s Republic of China does not have a tax treaty with the United States, the rate cannot be reduced. U.S. shareholders must report the net dividend on Form 1040 (or the appropriate 1040‑NR for non‑resident aliens) and can claim a foreign tax credit on Schedule 3 to offset the U.S. tax that would otherwise apply to the same income. The dividend is treated as ordinary (non‑qualified) income for U.S. tax purposes, so it is taxed at the investor’s marginal rate rather than the lower long‑term‑capital‑gains rate.

International investors – The tax treatment depends on the investor’s residence and any applicable tax treaty with China. Most jurisdictions that have a treaty with China can benefit from a reduced withholding rate (typically 10 %–15 %). Investors should consult their local tax advisors to determine whether they can claim a treaty benefit, whether a foreign‑tax credit or deduction is available in their home country, and what reporting forms are required (e.g., Form 1042‑S for U.S. withholding agents, local “dividend” statements, etc.). In jurisdictions without a treaty, the standard 30 % Chinese withholding applies, and the net amount must be declared according to local tax law.

Trading implications

Because the ex‑dividend date is September 9, 2025, the market will typically price in the dividend by a roughly one‑day‑forward‑adjusted drop of about the net dividend per share (gross dividend less 30 % Chinese tax). Technicals show AIJTY trading near its 50‑day moving average with modest upside momentum; however, the price correction on the ex‑date could create a short‑term buying opportunity for investors who are comfortable with the after‑tax yield (gross yield ÷ current price, then net of the 30 % withholding). For U.S. investors, the effective after‑tax yield will be lower once the foreign‑tax credit is factored in, so compare it against domestic dividend alternatives with qualified‑dividend treatment. International investors should weigh the treaty‑reduced rate against any home‑country tax on foreign dividends to gauge the true net return before positioning.