# US expat in Canada moving to the UK



## Stargazer

I have been doing American taxes from Canada for 9 years. I understand FBARs and FATCA and foreign tax credits and all that. I am compliant. And now we are heading to the UK. 

Can someone explain to me the differences I may encounter? My primary question has to do with retirement planning. In Canada, I have been fine as long as we invest for retirement strictly in RRSPs and always report them. We have avoided TFSAs because of the need to report them as a foreign trust and the fact that the IRS does not recognize their tax-free status. 

It doesn't seem to me that the UK has an RRSP equivalent? Or does it? I believe the ISA is like the TFSA and thus to be avoided. My husband's new employer has a pension plan we can participate in, or I believe they will give us the equivalent money to invest as we like. I want to set up our financial lives well, so they are simple and so we are compliant. Thoughts?


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## BBCWatcher

"Simple" is an ordinary bank account that doesn't yield interest. Assuming you don't want something _quite_ that simple, then I'd recommend making contributions to U.S. tax-advantaged retirement (IRA) and/or educational (529) savings accounts. IRA contributions must come from unexcluded earned income, so you must have some of that.

If you don't expect to retire in the United Kingdom (or in Canada, for that matter), then the tax advantages of those countries' retirement savings programs are probably lost on you. Don't worry about trying to optimize tax that won't matter. (If you spend two years working in Luxembourg would you worry about reducing your income tax in Luxembourg 20 years from now? Probably not.) You are a U.S. person, however, so in that sense a U.S. tax-advantaged savings vehicle may offer some benefits no matter where you retire.

On the other hand, if the employer is offering some kind of match that is uniquely available through the foreign tax advantaged account, then you probably still want to take the free money. Just be careful how you invest the funds, that's all, if you want to avoid complexity. Many investments are not foreign trusts and not PFICs. There have been a few discussions on that subject in this forum.


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## Stargazer

BBCWatcher said:


> "Simple" is an ordinary bank account that doesn't yield interest. Assuming you don't want something _quite_ that simple, then I'd recommend making contributions to U.S. tax-advantaged retirement (IRA) and/or educational (529) savings accounts. IRA contributions must come from unexcluded earned income, so you must have some of that.
> 
> If you don't expect to retire in the United Kingdom (or in Canada, for that matter), then the tax advantages of those countries' retirement savings programs are probably lost on you. Don't worry about trying to optimize tax that won't matter. (If you spend two years working in Luxembourg would you worry about reducing your income tax in Luxembourg 20 years from now? Probably not.) You are a U.S. person, however, so in that sense a U.S. tax-advantaged savings vehicle may offer some benefits no matter where you retire.
> 
> On the other hand, if the employer is offering some kind of match that is uniquely available through the foreign tax advantaged account, then you probably still want to take the free money. Just be careful how you invest the funds, that's all, if you want to avoid complexity. Many investments are not foreign trusts and not PFICs. There have been a few discussions on that subject in this forum.


So even within a pension, I have to be careful about what funds I choose? That is different from the Canadian RRSP where as long as the investments are in the RRSP, the PFIC rules don't apply. 

All our income is included, we take foreign tax credits rather than the foreign earned income exclusion. We do have a Roth IRA we could contribute to while abroad. We didn't do that in Canada because we had our RRSP which reduced our taxes, and also because Canada said if we contributed to our Roth while resident in Canada, they would start taxing it. 

We don't know how long we will be in the UK, it may be until we retire.


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## maz57

Phil Hodgen has an interesting discussion about ISAs here. HodgenLaw PC - International Tax He argues they are not trusts according to the IRS' definition of a trust and therefore don't trigger 3520/3520a but they are, however, still US taxable which pretty much eliminates any advantage if you happen to be a US citizen.

I never had any luck opening any sort of US account from outside the US. I not only gave that up, I gave up on US citizenship. That fixed everything, but obviously doesn't work if you want to retire in the US. You did properly exit the Canadian system, right?


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## jbr439

For the reasons Phil Hodgen gives that an ISA is not a 'foreign trust', the Canadian TFSA should also not be a foreign trust. Yet, Canadian cross-border tax preparers all seems to want to treat the TFSA as a foreign trust. No idea what UK cross-border tax preparers do w.r.t. the ISA.

Personally, I side with Mr Hodgen and it makes no sense to me that the TFSA or ISA would be a foreign trust; but I'm not even close to being a tax professional of any kind.


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## Bevdeforges

As far as the differences in filing from the UK are concerned, basically there are none. (Or rather, not all that many.) However, while a number of specific Canadian retirement plans have been exempted, excluded or simply explained in IRS rules and regulations, you'll find that is NOT the case for the retirement vehicles in the UK or other countries.

As others have explained, you have to take a stand on what you do or don't report to the IRS and how you do or don't report it. It helps if you've taken a good, hard look at the US-UK tax treaty, as that has a number of provisions that can come in handy if (and it's a big "if") you're called on to justify your tax stance. There are also a few quirks in the UK tax treaty (i.e. differences in how things are treated from the "run of the mill" foreign tax treaties) - specifically when it comes to the taxation of US Social Security benefits.

However, with the closure of the overseas IRS offices last year, I think it's safe to assume that "enforcement" may suffer (despite "assurances" from the IRS that they are beefing up overseas enforcement - somehow, without resorting to having boots on the ground). A logical, rational return made with good faith interpretations of "foreign items" should fly as long as you're not in the upper brackets with obviously questionable investments stashed somewhere. Even the professional tax "experts" and preparers disagree about any number of items when it comes to returns of overseas residents.
Cheers,
Bev


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## theOAP

ISA -
Primarily, there are 2 different types of ISAs. There is a third, but I'm not even sure it's offered anymore.

The first is a *cash* ISA. A true, simple cash ISA is simply a savings account. It may have a fixed rate or a variable rate. It may be instant access or for a fixed term. It is tax free in the UK, but not the US. For the US, it is reported on Schedule B just like any other savings account. Make sure it is a true cash ISA as some institutions may make offerings such as an enhanced cash ISA. Stay away from these, they're not a simple cash ISA.

The second is a *stocks and shares* ISA. Unless you have a desire to file all the PFIC paperwork, stay away from these at all costs. They are pooled funds (mutual funds). There are an extremely limited number of stocks and shares which are US based but are also UK HMRC reporting, but so far, no one has found any within a stocks and shares ISA.

It's also worth noting that starting 06 April 2016, the first £1,000 of interest from _any_ savings account will be tax free also if you are in the 20% tax bracket. If you're in the 40% bracket, it's £500 tax free. Therefore any _taxable_ savings account will have a UK tax free element, but will not be tax free for the US.


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## BBCWatcher

Stargazer said:


> So even within a pension, I have to be careful about what funds I choose?


Yes, provided you want to avoid triggering PFIC rules. That said, triggering PFIC rules isn't _necessarily_ a bad thing.



> That is different from the Canadian RRSP where as long as the investments are in the RRSP, the PFIC rules don't apply.


The U.S.-Canada tax treaty provides exceptional U.S. tax treatment for RRSPs (deferral until withdrawal, then U.S. taxable with any Canadian tax creditable). I agree with Bev that if another tax treaty (U.S.-U.K.) allows you to do something nonstandard, great.



> All our income is included, we take foreign tax credits rather than the foreign earned income exclusion. We do have a Roth IRA we could contribute to while abroad. We didn't do that in Canada because we had our RRSP which reduced our taxes, and also because Canada said if we contributed to our Roth while resident in Canada, they would start taxing it.


Canada might anyway. As I understand it, the treaty defers Canadian taxes on a Roth IRA but, upon withdrawal, the gains are Canadian taxable if you're subject to Canadian taxes. Check that, of course. Repeat after me: there is no such thing as an _internationally_ tax advantaged retirement account.

....So, one strategy is to diversify. For example, if there's a possibility that you'll retire in the United Kingdom then you can contribute to an ISA. But if you don't want to trigger PFIC rules, and assuming the tax treaty doesn't say otherwise (a safe assumption, I'd say, but check) then just be careful what you put into your ISA. Some examples: direct holding of genuine, individual bank and insurance company stocks (equities), direct holding of bonds/gilts (but not bond funds), direct holding of U.S. listed securities (including ETFs) bought and sold on the NYSE or NASDAQ.

And also contribute to your Roth IRA, assuming the U.K. will at least offer tax deferral on those funds until withdrawal. If the U.K. doesn't -- if a Roth IRA is "just another foreign account" from the U.K. perspective -- then you have to be very careful to buy and hold during your U.K. stint, preferably with low or zero dividends and capital gains on those Roth holdings.


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## theOAP

BBCWatcher said:


> Canada might anyway. As I understand it, the treaty defers Canadian taxes on a Roth IRA but, upon withdrawal, the gains are Canadian taxable if you're subject to Canadian taxes. Check that, of course. Repeat after me: there is no such thing as an _internationally_ tax advantaged retirement account.


The OP has asked about the pension situation in the UK. Withdrawals form a US ROTH is tax free in the UK, via the Double Tax Treaty.



BBCWatcher said:


> ....So, one strategy is to diversify. For example, if there's a possibility that you'll retire in the United Kingdom then you can contribute to an ISA. But if you don't want to trigger PFIC rules, and assuming the tax treaty doesn't say otherwise (a safe assumption, I'd say, but check) then just be careful what you put into your ISA. Some examples: direct holding of genuine, individual bank and insurance company stocks (equities), direct holding of bonds/gilts (but not bond funds), direct holding of U.S. listed securities (including ETFs) bought and sold on the NYSE or NASDAQ.


An ISA has nothing to do with retirement. An ISA is an account which you contribute to as you like, and which you can withdraw from at anytime for any reason (new Ferrari). It's a stash of cash which, if you wish, you may hold onto and withdraw from after you retire, but it's not specifically retirement related.

Speaking of a new Ferrari, the UK pension landscape is currently undergoing substantial change. As Bev mentioned,_ "There are also a few quirks in the UK tax treaty..."_. That includes employer pensions and pensions in general.

In the UK there are defined benefit final salary pensions, defined contribution pensions, Self Invested Personal Pensions (SIPP), personal pensions, stakeholder pensions, government mandated pensions which certain employers must provide for certain employees, and more. Aside from defined benefit final salary pensions, you will not find a consensus as to how these should be reported on a US tax return.

Recent changes to UK pension rules have dictated that the funds from certain pensions (including many employer sponsored pensions), upon maturing, may be withdrawn and used as the pensioner may wish. In other words, they may take the pension pot and buy a new Ferrari.

Employer sponsored pensions (defined benefit or defined contribution) are generally seen as complying with the Treaty (from the now defunct IRS unit at the US embassy), although more conservative US/UK dual tax advisors may disagree with this as regards defined contribution pensions.

It's suggested the OP contact a qualified dual US/UK tax advisor prior to enrolling in any UK pension if they are uncertain. The general consensus is pensions which contain employer contributions meet the Treaty objectives, but as mentioned earlier, there is by far no majority agreement with this stance.

There will be very few UK employers (none I know of) that will make their share of contributions to a US pension scheme (IRA, 40?, etc.).


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## Stargazer

Thank you for all your replies! Lots to think about, and sounds like there is not always consensus on how the IRS views things.

We will be in London. Are there any recommended international financial advisors you could recommend there? We are not high earning, so would not want to pay high fees. However, because we are not high earning, it seems that much more important to get this right. My husband is 40 years old, if we stay in England until he is 65, we don't want to find out at that point that the financial decisions we made have adverse consequences. I think it would be wise to at least consult with someone, preferably someone we could see face to face once we get there. Obviously we would look for US-UK specialists, but would like someone who understands the Canada angle as well (ie. leave our RRSPs here, move them, etc?)

Also, I am wondering if we should move our Roth IRAs before we leave. What companies will willingly deal with American expats who are actively contributing to their Roths from abroad? I understand many companies are dropping American clients.


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## Stargazer

maz57 said:


> Phil Hodgen has an interesting discussion about ISAs here. HodgenLaw PC - International Tax He argues they are not trusts according to the IRS' definition of a trust and therefore don't trigger 3520/3520a but they are, however, still US taxable which pretty much eliminates any advantage if you happen to be a US citizen.
> 
> I never had any luck opening any sort of US account from outside the US. I not only gave that up, I gave up on US citizenship. That fixed everything, but obviously doesn't work if you want to retire in the US. You did properly exit the Canadian system, right?


Well, we are still in Canada. I understand that in 2017, I will need to file a Canadian departure return. Anything else?


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## jbr439

Stargazer said:


> Well, we are still in Canada. I understand that in 2017, I will need to file a Canadian departure return. Anything else?


And that includes paying tax on certain unrealized capital gains (e.g. Apple stock).


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## Stargazer

jbr439 said:


> And that includes paying tax on certain unrealized capital gains (e.g. Apple stock).


Well I don't have anything except a house and RRSPs, which I believe are protected from departure tax?


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## BBCWatcher

Stargazer said:


> Also, I am wondering if we should move our Roth IRAs before we leave.


Not unless you otherwise planned to change custodians, no. If your current custodian kept you as a customer while you were in Canada, I don't see why the United Kingdom would be any different in that respect.

Cross that bridge if/when you get there, but presumably you've already crossed that particular bridge without incident.


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## BBCWatcher

theOAP said:


> An ISA has nothing to do with retirement.


Well, it has just as much to do with retirement as with Ferraris. Which is not _nothing_.

But, as I hinted, that's all the more reason why an ISA is unlikely to be recognized in a U.S.-U.K. tax treaty as anything "special," particularly for U.S. persons subject to the treaty's savings clause. Of course check that, but I'm not optimistic. 



> There will be very few UK employers (none I know of) that will make their share of contributions to a US pension scheme (IRA, 40?, etc.).


Not directly, no, agreed.


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## jbr439

Stargazer said:


> Well I don't have anything except a house and RRSPs, which I believe are protected from departure tax?


My understanding (take with a grain of salt) is that you are correct. Principal residence and RRSPs are not subject to tax. Principal residence because it's tax free anyway, RRSPs because they'll tax you when you eventually make withdrawals.


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## theOAP

Stargazer said:


> Are there any recommended international financial advisors you could recommend there? We are not high earning, so would not want to pay high fees.


U.S. tax preparation done by a qualified dual professional in the UK is expensive (roughly £150 - £200/hr. and up). Most are located in the London area. Other than a search on the internet, there really are no places to find recommendations. You may wish to contact an EA (enrolled agent) and the UK listings are here:

https://member.naea.org/naeassa/rflssareferral.query_page

_(Sorry, the previous link doesn't work. try the one above; select United Kingdom from the drop down, and change radius of search to "please select". Leave all other boxes blank.)_

There is a website for US expats in the UK (UK-Yankee), and the question of recommended professionals is often asked, but there are few responses. At least two of those listed on the EA list have highly regarded international reputations.

If you have been doing your US returns yourself in Canada, there should be few problems doing it in the UK. UK tax, and a tax return, is very straight forward for those with relatively simple tax situations.


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## Stargazer

theOAP said:


> U.S. tax preparation done by a qualified dual professional in the UK is expensive (roughly £150 - £200/hr. and up). Most are located in the London area. Other than a search on the internet, there really are no places to find recommendations. You may wish to contact an EA (enrolled agent) and the UK listings are here:
> 
> https://member.naea.org/naeassa/rflssareferral.query_page
> 
> _(Sorry, the previous link doesn't work. try the one above; select United Kingdom from the drop down, and change radius of search to "please select". Leave all other boxes blank.)_
> 
> There is a website for US expats in the UK (UK-Yankee), and the question of recommended professionals is often asked, but there are few responses. At least two of those listed on the EA list have highly regarded international reputations.
> 
> If you have been doing your US returns yourself in Canada, there should be few problems doing it in the UK. UK tax, and a tax return, is very straight forward for those with relatively simple tax situations.


Thanks! Yes, I want to keep my tax returns as simple as possible. I don't want to do anything that would make me have to file an 8621 (is that right?) or a 3520 if I can help it. Is a 3520 difficult? With RRSPs, we had the 8891 instead but now that has been dropped and they don't have to be reported every year except on the FBAR. 

But on the other hand, if we are there long-term, I need to have a wise investment strategy for retirement. Sounds like I need to study the US-UK tax treaty more in depth as well. I will check out UK Yankee.


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## Stargazer

So I have been researching this a bit more. The pension plan that my husband can join is a group stakeholder pension. If we don't want to join, they will agree to give us the money for another investment. I specifically asked if they would be OK with funding Roths at Charles Schwab UK and they said yes. 

When I look at having Roths with Charles Schwab, it seems like much less of a headache than trying to figure out the reporting and taxation of a foreign pension. The Roths are in US dollars, neither the US nor the UK will tax them at distribution, and it would be easy to access if we retire in the US. 

We would lose out on 20% of the employer money because the funding would be after-tax, not pre-tax. Other than that, would there be disadvantages? Currency risk if we stayed in the UK but our Roths were denominated in US dollars? 

We should be eligible for contributing to Roths because we take a foreign tax credit, not the exclusion.


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## BBCWatcher

Stargazer said:


> We would lose out on 20% of the employer money because the funding would be after-tax, not pre-tax.


True, but Roth IRAs are after-tax on the U.S. side anyway, so that lines up. Or are you saying that the employer provides matching funds, i.e. extra pounds?



> Currency risk if we stayed in the UK but our Roths were denominated in US dollars?


Not a problem. If you're concerned about currency risk then just pick something in your Roth IRA highly correlated with the pound. An investment in a low cost U.K. equities mutual fund or Exchange Traded Fund, for example. Ticker symbol EWU is one example, although there could be something else with a lower expense ratio. Don't overdo it, though. You probably don't want 100% of your total savings to be perfectly tied to the fate of the pound, even if you're 100% certain you would retire in the U.K.



> We should be eligible for contributing to Roths because we take a foreign tax credit, not the exclusion.


That'll work, although watch the income limits.

It's at least somewhat likely that the employer's pre-tax contributions to that U.K. pension scheme would have to be counted as taxable income on the U.S. side when made, as made. And it might not even be excludable income. If either/both of these things is true then I _really_ like the Roth idea. But the key is whether you'd be missing out on matching funds. From a tax point of view I think you've got a winning idea.


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## Stargazer

Thanks BBC Watcher. My understanding is that if we contribute to the work pension scheme, then the GOVERNMENT will kick in an additional 20%. However, then we "contract-out" of the state pension scheme? Not sure exactly how that works. So we lose out on some government money. However, perhaps a small price to pay for no tax from either country on Roth distributions. 

The work pension scheme otherwise is completely employer funded and ends up being $12,500 USD equivalent or so. they will give us the cash if we choose to invest elsewhere. 

That would be more than we are entitled to contribute to Roths ($5500 each?) per year. So not sure what we would do with the extra money. Charles Schwab UK said as non-residents, we would not be able to invest in mutual funds, but would do ETFs. Does that sound OK? And they don't provide advice until you have $500,000 invested with them, but have tools online. This would be our main retirement fund. My husband just turned 40 and we want to make really wise retirement planning decisions over the next years. I wonder if Charles Schwab UK is the only London-based place offering Roth IRAs in USD? Or should I be looking at others too?


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## iota2014

Stargazer said:


> Thanks BBC Watcher. My understanding is that if we contribute to the work pension scheme, then the GOVERNMENT will kick in an additional 20%. However, then we "contract-out" of the state pension scheme? Not sure exactly how that works.


By "contracting out" of what used to be called the Additional State Pension, you pay National Insurance at a lower rate. I was under the distinct impression contracting-out was going to be ending in April, when the new state pension comes into being, but I may be mistaken.


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## Stargazer

iota2014 said:


> By "contracting out" of what used to be called the Additional State Pension, you pay National Insurance at a lower rate. I was under the distinct impression contracting-out was going to be ending in April, when the new state pension comes into being, but I may be mistaken.



I see. So we would still get the basic state pension? Is this basically the same as Social Security?


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## iota2014

Stargazer said:


> I see. So we would still get the basic state pension? Is this basically the same as Social Security?


Yes, the state pension is the UK form of Social Security. It's changing rather drastically, effective April 2016. There's some information at https://www.gov.uk/new-state-pension/overview - that document has a bit about how it works if you've paid into a workplace pension and have been contracted-out. 

It does say that contracting-out is coming to an end - which is logical, since there will no longer be an Additional State Pension. Maybe you should ask the employer for information on this point.


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## BBCWatcher

Regarding Charles Schwab, if you already have a U.S. account you can get funds into it from the U.K. rather affordably using their custodial account in the U.K. They should provide instructions on how to do that. You probably shouldn't get a Schwab U.K. account since it'd be redundant at best.


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## Stargazer

BBCWatcher said:


> Regarding Charles Schwab, if you already have a U.S. account you can get funds into it from the U.K. rather affordably using their custodial account in the U.K. They should provide instructions on how to do that. You probably shouldn't get a Schwab U.K. account since it'd be redundant at best.


Our existing Roths aren't with Schwab. I have been thinking about moving them anyway and like the fact that Charles Schwab is in London, this branch is more familiar with the kind of issues I might face as an expat (it seems).


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## BBCWatcher

Maybe, but I think you're better off keeping your Schwab account with the U.S. Schwab. You can still use Schwab's U.K. services (such as their custodial deposit/transfer service, or stopping by the branch) if you want.


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## Stargazer

BBCWatcher said:


> Maybe, but I think you're better off keeping your Schwab account with the U.S. Schwab. You can still use Schwab's U.K. services (such as their custodial deposit/transfer service, or stopping by the branch) if you want.



Schwab UK told me that all their accounts are US based


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## BBCWatcher

Then why the trading restrictions?


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## Stargazer

BBCWatcher said:


> Then why the trading restrictions?


Well, they said that if you're not a US resident, you can't have mutual funds, just ETFs and other investments. I assume Charles Schwab US has the same restrictions, perhaps for the same reason a lot of brokerages have been getting rid of US clients?

I am also looking into Thun Financial in Wisconsin, and it seems they invest for their overseas clients in ETFs as well. I guess I thought it was just a price to pay for not being resident in the US. 

I will say that Charles Schwab UK said they can't give me any personalized advice until our accounts reach 500K, which will be a while! Not thrilled about that, that puts me off a bit, as we want to make very good decisions and not just guess.


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## BBCWatcher

Stargazer said:


> Well, they said that if you're not a US resident, you can't have mutual funds, just ETFs and other investments.


Ah.

Well, would you have a valid U.S. mailing address to keep on your Schwab U.S. account? That's all that's required if that's the problem.

By the way, I like Schwab in many respects, but Schwab isn't my favorite for U.S. mutual funds specifically. Vanguard is. Although it is possible to purchase Vanguard's mutual funds through a Schwab U.S. account, Schwab charges a fee to do that. Such fees are not required with a Vanguard U.S. account. One thing I do like very much about Schwab U.S. is that you can get their terrific Visa debit/ATM card that's really great for international travel. Schwab Bank U.S. also offers a terrific Visa debit/ATM card, e.g. with their High Yield Investor Savings account, but yes, you can get a debit/ATM card with your Schwab U.S. brokerage account without having a Schwab Bank U.S. account.

Vanguard also has an outpost in the United Kingdom, but it's really geared to non-U.S. persons with at least £100,000 to invest.

If you can stand the $10 monthly minimum commission charge then Interactive Brokers is worth looking into. I quite like them, but (like Vanguard U.K.) it's not for small investors. More like "medium" and up. IB is probably the lowest cost way to exchange currencies. Like Schwab they have a lot of custodial accounts in various countries (the U.K. is surely one of them) where you can deposit local currency for crediting to your account via a domestic fund transfer, but unlike Schwab you can set up an IB account for a U.K. pound (or other) "base" currency _then_ decide when and how you want to convert those pounds into something else (U.S. dollars for example). IB is U.S.-based, so they have no trouble depositing converted U.S. dollar funds into your U.S. bank or credit union account, although they do charge a withdrawal fee if you do that more than once per calendar month.


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## Stargazer

BBCWatcher said:


> Ah.
> 
> Well, would you have a valid U.S. mailing address to keep on your Schwab U.S. account? That's all that's required if that's the problem.
> 
> By the way, I like Schwab in many respects, but Schwab isn't my favorite for U.S. mutual funds specifically. Vanguard is. Although it is possible to purchase Vanguard's mutual funds through a Schwab U.S. account, Schwab charges a fee to do that. Such fees are not required with a Vanguard U.S. account. One thing I do like very much about Schwab U.S. is that you can get their terrific Visa debit/ATM card that's really great for international travel. Schwab Bank U.S. also offers a terrific Visa debit/ATM card, e.g. with their High Yield Investor Savings account, but yes, you can get a debit/ATM card with your Schwab U.S. brokerage account without having a Schwab Bank U.S. account.
> 
> Vanguard also has an outpost in the United Kingdom, but it's really geared to non-U.S. persons with at least £100,000 to invest.
> 
> If you can stand the $10 monthly minimum commission charge then Interactive Brokers is worth looking into. I quite like them, but (like Vanguard U.K.) it's not for small investors. More like "medium" and up. IB is probably the lowest cost way to exchange currencies. Like Schwab they have a lot of custodial accounts in various countries (the U.K. is surely one of them) where you can deposit local currency for crediting to your account via a domestic fund transfer, but unlike Schwab you can set up an IB account for a U.K. pound (or other) "base" currency _then_ decide when and how you want to convert those pounds into something else (U.S. dollars for example). IB is U.S.-based, so they have no trouble depositing converted U.S. dollar funds into your U.S. bank or credit union account, although they do charge a withdrawal fee if you do that more than once per calendar month.


I prefer to be totally above board with telling a brokerage where I live just in case it becomes a problem. I did go to the website and see if I could go ahead and open a Schwab account before we officially move. One problem is they want our driver's license, which gives away that we are in Canada, and they won't deal with people in Canada. Once we get to the UK, it should be OK to deal with us. 

Interesting about the fees for Vanguard funds with Charles Schwab. Do they charge extra fees for the Vanguard ETFs?


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## BBCWatcher

Stargazer said:


> I prefer to be totally above board with telling a brokerage where I live just in case it becomes a problem.


I do too. But mailing addresses are not residential addresses. Practically everybody with a high net worth, for example, has different addresses for those two things.



> Interesting about the fees for Vanguard funds with Charles Schwab. Do they charge extra fees for the Vanguard ETFs?


Schwab charges commissions to trade ETFs since they are just like any other exchange-traded security.


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## Stargazer

BBCWatcher said:


> I do too. But mailing addresses are not residential addresses. Practically everybody with a high net worth, for example, has different addresses for those two things.
> 
> 
> Schwab charges commissions to trade ETFs since they are just like any other exchange-traded security.


Well, maybe I could ask them about it. I did notice, though, that for a joint brokerage account with Schwab, something I am considering in addition to the Roths, you can open one for $1000 in the US but need a minimum of $10000 to open one abroad? So maybe I should just wait, maybe there are different rules for non-residents about what we can open.


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## BBCWatcher

Or don't pick Schwab. Shop around.


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## Stargazer

BBCWatcher said:


> Or don't pick Schwab. Shop around.


Do you know of other places that don't mind having American expats? Seems lots of brokerages have been refusing them.


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## BBCWatcher

Practically all of them love expats with U.S. mailing addresses.

But OK, if you don't want to have a mailing address that is different than your residential address, I mentioned one: Interactive Brokers. There are probably others. We used to have a thread listing the dozen or so that were/are happy to have non-U.S. mailing addresses on their accounts.


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