UCITS, short for ‘undertakings for collective investment in transferable securities’, is a regulatory framework established by the European Union (EU) to ensure investor protection and fund transparency across EU member states.
UCITS exchange-traded funds (ETFs) are domiciled in Europe, but for the purpose of this article, when we refer to UCITS ETFs, we really mean UCITS that are domiciled in Ireland and usually listed in London.
If you’re a Singaporean investor focused on tax efficiency and long-term wealth building, UCITS ETFs (Irish-domiciled) could be a better choice than US-listed ETFs. Here’s why:
Benefits of Investing in UCITs ETFs for Singaporean Investors
- Lower Withholding Tax
One of the biggest advantages of UCITS ETFs is the lower withholding tax on dividends. US-listed ETFs like SPY and VOO are subject to a 30% withholding tax on dividends for Singaporean investors. However, UCITS ETFs domiciled in Ireland benefit from a more favorable tax structure, with only a 15% withholding tax at the fund level and no additional tax for Singaporean investors. This means you cut your withholding tax in half, improving your net returns.
For example, if you invest US$100,000 in an ETF with a 2% dividend yield per year, the withholding tax for a US-listed ETF would be US$600 (US$100,000 × 2% × 30%), while for an Irish-domiciled UCITS ETF, it would be only US$300 (US$100,000 × 2% × 15%). That’s US$300 more in your pocket every year—without doing anything extra.
- No US Estate Tax Risk
Many investors overlook the fact that US estate tax applies to US-listed ETFs, regardless of where the ETF invests. If your total US assets exceed US$60,000 at the time of your passing, your beneficiaries could face up to 40% in estate tax. This means your holdings in VOO, QQQ, or other US-listed ETFs could be heavily taxed before your loved ones even inherit them.
By choosing UCITS ETFs instead, you completely avoid this estate tax risk. Since Irish-domiciled UCITS ETFs are not considered US assets, they do not fall under US estate tax rules. If wealth preservation and succession planning matter to you, UCITS ETFs make a lot more sense.
- Access to Accumulating Share Classes
Unlike US-listed ETFs, UCITS ETFs offer accumulating share classes, which automatically reinvest dividends within the fund. This reinvestment helps to compound your returns more efficiently, without triggering taxable events.
With US ETFs, dividends are always paid out and must be manually reinvested, which can be inconvenient. Accumulating share classes simplify the process, making UCITS ETFs an excellent choice for long-term investors who want seamless compounding.
Overview of UCITS ETFs Tracking US and Global Equities
| iShares Core S&P 500 UCITS ETF | SPDR S&P 500 UCITS ETF | Vanguard FTSE All-World UCITS ETF | Vanguard S&P 500 UCITS ETF | iShares Core MSCI World UCITS ETF | |
| Ticket | CSPX | SPYL | VWRA | VUAA | IWDA |
| Underlying Index | S&P 500 | S&P 500 | FTSE All-World Index | S&P 500 | MSCI World Index |
| Expense Ratio | 0.07% | 0.03% | 0.22% | 0.07% | 0.20% |
| AUM | 117.1B | 18,4B | 35.6B | 59.2B | 87.3B |
| Number of Holdings | 503 | 496 | 3,654 | 503 | 1,409 |
| Avg. Daily Trading Volume | 154.8K | 630.6K | 85.9K | 172.9K | 793.2K |
| Allocation | Large, established US companies | Large, established US companies | Large to mid-sized companies in developed and emerging markets | Large, established US companies | More exposure to developed markets |
| Use of Income* | Accumulating | Accumulating | Accumulating | Accumulating | Accumulating |
| *Note on the use of income:Accumulating ETFsAccumulating ETFs automatically reinvest any income generated back into the funds, allowing investors like you to maximise the benefits of compounding. ETFs are often preferred by those looking to compound their investments over time without active management. Distributing ETFsThere are also ETFs that distribute their income, meaning these funds distribute the income they earn to investors by paying dividends at set intervals. If you’re looking to generate regular income from your investments, distributing ETFs are the way to go. |
Popular US UCITS ETFs
iShares Core S&P 500 UCITS ETF (CSPX)
| Underlying Index | S&P 500 |
| Expense Ratio | 0.07% |
| AUM (in USD) | 117.1B |
| Avg. Daily Trading Volume | 154.8K |
| Number of Holdings | 503 |
| Allocation | Large, established US companies |
| Use of Income* | Accumulating |
CSPX was launched in 2010 and its objective is to provide investors exposure to large, established US companies for long-term, globally diversified growth.
The fund features 503 holdings across sectors like information technology, financial services, healthcare, real estate, and more.
SPDR S&P 500 UCITS ETF (SPYL)
| Underlying Index | S&P 500 |
| Expense Ratio | 0.03% |
| AUM (in USD) | 23.99B |
| Avg. Daily Trading Volume | 630.6K |
| Number of Holdings | 503 |
| Allocation | Large, established US companies |
| Use of Income* | Accumulating |
As its name suggests, SPYL is an UCITS ETF that tracks the S&P 500 index. The fund was only just recently incepted in October 2023, and like CSPX, the fund offers exposure to the large cap segment of the US equities.
Vanguard FTSE All-World UCITS ETF (VWRA)
| Underlying Index | FTSE All-World Index |
| Expense Ratio | 0.22% |
| AUM (in USD) | 35.6B |
| Avg. Daily Trading Volume | 85.9K |
| Number of Holdings | 3,654 |
| Allocation | Large to mid-sized company in developed and emerging markets |
| Use of Income* | Accumulating |
Backed by industry powerhouse Vanguard, VWRA seeks to track the performance of the FTSE All-World Index that comprises large to mid-sized companies in developed and emerging markets like the US, Japan, and China.
Vanguard S&P 500 UCITS ETF (VUAA)
| Underlying Index | S&P 500 |
| Expense Ratio | 0.07% |
| AUM (in USD) | 67.8B |
| Avg. Daily Trading Volume | 172.9K |
| Number of Holdings | 503 |
| Allocation | Large, established US companies |
| Use of Income* | Accumulating |
Much like CSPX and SPYL, VUAA seeks to track the S&P 500 index. The fund was established in 2019 and has since become a popular UCITS ETF among investors.
iShares Core MSCI World UCITS ETF (IWDA)
| Underlying Index | MSCI World Index |
| Expense Ratio | 0.20% |
| AUM (in USD) | 101.8B |
| Avg. Daily Trading Volume | 793.2K |
| Number of Holdings | 1,396 |
| Allocation | More exposure to developed markets |
| Use of Income* | Accumulating |
Source: Morningstar, iShares, 13 Feb 2025
IWDA tracks the MSCI World Index and aims to provide inventors with broad exposure to a wide range of global companies within 23 developed countries like the US, Japan, United Kingdom, and more.
Which UCITS ETF Should You Buy?
Ultimately, the UCITS ETF that you decide to buy depends on your goals. Investing is deeply personal, so the decisions you make should be based on your beliefs or convictions.
For example, someone who believes that emerging markets are poised for growth may choose to invest in VWRA. On the other hand, SPYL or CSPX might be suitable for an investor who thinks that the US will continue to dominate in the future.
UCITS ETFs — Now Available on Syfe Brokerage
In addition to US UCITS ETFs, investors who wish to gain greater exposure to other markets can explore more UCITS available on Syfe.
| Ticker | Underlying Index | Expense Ratio | Allocation | Ticker |
| CSPX | S&P 500 | 0.07% | Equity | Acc |
| XDWL | MSCI World | 0.12% | Equity | Acc |
| EIMI | MSCI Emerging Markets IMI | 0.18% | Equity | Acc |
| XDEW | S&P 500 Equal Weight | 0.20% | Equity | Acc |
| VWRA | FTSE All-World | 0.22% | Equity | Acc |
| IHYU | Markit iBoxx USD Liquid High Yield Capped | 0.50% | Fixed Income | Dis |
If you’re looking to invest in UCITS ETFs, you can now do so with Syfe Brokerage.
Syfe Brokerage is the easiest way to invest in 6 of some of the most popular UCITS ETFs, allowing you to save 50% of US withholding taxes on dividends.
Plus, we offer the lowest fees in the market. Coupled with our easy-to-use interface, getting started with UCITS ETFs is now easier than ever.
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