Brit wants to change from MB trading to another US etrade companhy, which one?

[textbook]

If I am a resident of Japan or the UK, it seems I am not allowed to trade with MB trading anymore, will I have to transfer the money back to UK trade account or is there another US company anyone can recommend I transfer the money to?

[manoman]

I'm facing the same dilemma. Received notice last week that Ameritrade has decided to discontinue offering services to customers from Japan as well as a host of other countries. I need to switch my US holdings to a new brokerage. What are others using or recommend for Japanese residents?

[Plats]

I've heard that Schwab is non-resident friendly.

[Brown Cow]

I don't know if this meets your needs or not but I have found them refreshingly free of residence crap. You can do most anything except buy and sell shares directly in the Japanese market. If you want to gamble on/trade derivatives you can - I haven't been tempted yet.

http://www.internaxx.lu/

[manoman]

Thanks Plats & Brown Cow for your replies. I've decided to with Schwab for now but internaxx sure looks interesting, looks to be a 'one stop shop' for investments.

[johnnyG]

I've heard that Schwab is non-resident friendly.

+1

I've heard the very same thing...

[minamon]

Comparing Schwab (US) and Internaxx (Lux) [who changed their name to TD Direct Investing)

** Schwab **
+ very cheap for buying US denominated investments
+ no annual management charge (I think),
BUT (some bad points)
- only US dollar, no multicurrency accounts
- you automatically pay US taxes (around 30%)

This tax situation would be OK except you have to pay Japanese taxes also, so if you made, say, $1000 profit in a year, that would be $700 after US tax. Then the Japanese tax would be applied to the $700 at, for example, a rate of 25%, leaving you with $525 (i.e., you pay not far off 50% tax). Not cheap.


** Tddirectinvesting **
- Annual management fee of 0.2% (min 60 euro, max 600 euro)
- Not so cheap for buying funds, ETFs, etc. (e.g. 70 euros to buy stocks or ETF worth 100-250k euros)
BUT (some good points)
+ no double taxation; if/when you declare your earnings for Japanese taxation, you only pay at a rate that applies to your income (25% for example)
+ multicurrency account is OK

Any corrections/mistakes/comments?

[Agitator]

This tax situation would be OK except you have to pay Japanese taxes also, so if you made, say, $1000 profit in a year, that would be $700 after US tax. Then the Japanese tax would be applied to the $700 at, for example, a rate of 25%, leaving you with $525 (i.e., you pay not far off 50% tax). Not cheap.

Not quite. You can take a foreign tax credit for the US taxes paid (just as you can do in the reverse). In your example, no further taxes would be owed to Japan as the $300 foreign tax credit offsets the $250 Japanese tax liability (your 25% hypothetical rate would be calculated on the total profit). In essence, you will pay the maximum of the two rates.

Financially,
A.

[Brown Cow]

Not quite. You can take a foreign tax credit for the US taxes paid (just as you can do in the reverse). In your example, no further taxes would be owed to Japan as the $300 foreign tax credit offsets the $250 Japanese tax liability (your 25% hypothetical rate would be calculated on the total profit). In essence, you will pay the maximum of the two rates.

Financially,
A.

Correct. They first calculate your tax liability in full and then any tax you have paid (in double taxation agreement countries) is deducted. You then pay the balance. Luxembourg was, I believe a very private place when it came to financial affairs. The banking destination of choice for the Kim family of N Korea in fact. Fairly recently, they have been forced to supply information to tax authorities in other countries.

[minamon]

thanks for correction re double taxation

[Plats]

The USA IRS does not tax non-resident aliens 30% on investment income. It withholds 30%. It may be refunded with the timely filing of Form 1040NR.

[onigiri]

woah, hi guys,
Do you get your income here in Japan in JPY..? if you do, then to invest using a foreign stock broker would mean that we'll need to transfer fund to the country of the brokerage (which will cost some money and time) right..?
If so, why don't you consider local brokers here already in Japan..? (probably by learning which button is to buy or sell later..)

Sorry for the very newbie question, it's my first time setting up an account, and I'm abroad
Thanks!

[minamon]

woah, hi guys,
Do you get your income here in Japan in JPY..? if you do, then to invest using a foreign stock broker would mean that we'll need to transfer fund to the country of the brokerage (which will cost some money and time) right..?
If so, why don't you consider local brokers here already in Japan..? (probably by learning which button is to buy or sell later..)
Thanks!

I have a local online broker (Monex) here for funds in Japan.

For overseas funds (transferred to Europe mostly in the 90s) that I dont want to bring back to Japan (due to strong yen, and other reasons), I need some broker in Europe or US.

Up to now I used managed funds in UK surroundings, but I realise they are charging up to 1% rip-off annual fee. Online do-it-yourself seems the way to go, even for ETFs and other funds, rather than pay for managed funds whose managers dont know how to manage.

[minamon]

update:

Internaxx (TD Direct Investing) dont accept Japan residents.

[Brown Cow]

That's a shame. I hope they don't ask me to close my account.