Trading in UK shares as a non-resident

[marcodigio]

Hi. My future plan is to eventually retire in Thailand and use the income from dividends I hold in shares and funds in UK. I was doing quite a lot of reading about it and found out that most share dealing services would not be happy to to continue having me as a non-resident customer. For me to continue passing as a UK resident even after having moved is something that I would not be comfortable in doing, especially with all the extra checks now in place. Reading through the thaivisa forum is evident that some of you choose the dividend revenue as their (main) income in Thailand. Which is the best way to do this? Which brokers can you recommend? I would really appreciate if someone has the time to share their experiences. Many thanks.

[AlexRich]

If you hold shares in an ISA then you can continue to trade with your UK broker, but you will not be allowed to add any more money into the account after you become non-resident. All dividends and capital gains will continue to be tax free.

 

Outside of an ISA wrapper I believe that all dividends and any capital gains will still be subject to UK tax, if you trade with a UK broker, even though you are now non-resident. To avoid that you could transfer your account to an offshore broker, like, for example, Internaxx, who are based in Luxembourg. There are several others to choose from.

 

It's a good question ... I'll be interested to see the replies.  

 

 

 

 

[simoh1490]

I got there by accident with this!

 

My private pension was being managed by an IFA using the Transact platform, a few years ago I had to fire the IFA which left me to administer the pension whilst living offshore and without an IFA. Transact won't let you join them without an IFA but you can always do as I did and terminate your IFA and Transact will not ask you to move your account, the fact is that expats cannot get access to onshore IFA's anyway so your UFA/platform arrangements need to be in place before you leave the UK. Ditto Hargreaves Lansdowne who won't touch let you join them whilst being an offshore resident.

[BritManToo]

Take a look at Hargreaves Lansdown.

You can do everything online, once you have set up an account as a UK resident.

The only investment/pension company who never tried to cheat me.

 

Note to Simoh1490, if you don't tell them, they don't check.

You just need a UK mailing address for the initial forms.

Edited November 11, 2018 by BritManToo

[KittenKong]

5 hours ago, AlexRich said:

Outside of an ISA wrapper I believe that all dividends and any capital gains will still be subject to UK tax, if you trade with a UK broker, even though you are now non-resident.

Capital gains on shares are tax-free for non-residents.
Dividends are also tax-free if you benefit from the concession applied to non-residents which limits the tax due on dividends and bank interest to that paid at source. This concession is probably not suitable for anyone who has significant other taxable income in the UK (rent, pensions etc). It probably is suitable for anyone who only has bank interest, dividend payments, premium bonds and gilts. It may be suitable for someone who has a little taxable income and a large share portfolio. Individual circumstances and liability will vary according to the nature of your income, and should be taken into account.

[KittenKong]

1 hour ago, BritManToo said:

Take a look at Hargreaves Lansdown.

......

The only investment/pension company who never tried to cheat me.

If you look at the fees they charge you can understand why they dont need to cheat you.

 

HL would charge me at least £1000 more per year than ii would for the same holding. And in fact the ii custody charge can be set off against trading charges, thus making it free for anyone who trades 8 or so times a year.

[Spidey]

1 hour ago, BritManToo said:

Note to Simoh1490, if you don't tell them, they don't check.

You just need a UK mailing address for the initial forms.

 I was actually asked, but as I have a UK postal address, UK bank accounts and pay my tax in the UK, I simply denied it. No problem.

 

I'll do the same with my state pension, when it's due and still receive free healthcare in the UK.

[marcodigio]

10 hours ago, BritManToo said:

Take a look at Hargreaves Lansdown.

You can do everything online, once you have set up an account as a UK resident.

The only investment/pension company who never tried to cheat me.

 

I'm currently a customer of Hargreaves Lansdown. On top of a shares account I have a SIPP with them too. I will be more than happy to carry on using them if I move abroad, but after being reading all of their terms and conditions (sigh!), it's not entirely clear if you can carry on dealing as normal. I have contacted them, but still waiting for a reply. The last thing I would need is for my account to be frozen if I wasn't following their terms and condition. But surely there must be a lot of their SIPP customers who retired abroad? 

 

[BritManToo]

2 minutes ago, marcodigio said:

I have contacted them, but still waiting for a reply.

That was silly, best to keep quiet about where you are and what you're doing.

I expect you'll be contacting the state pensions people to freeze your pension as well.

Not to mention the NHS to cancel your coverage.

Edited November 12, 2018 by BritManToo

[marcodigio]

8 hours ago, Spidey said:

 I was actually asked, but as I have a UK postal address, UK bank accounts and pay my tax in the UK, I simply denied it. No problem.

 

I'll do the same with my state pension, when it's due and still receive free healthcare in the UK.

The problem with them is that if I were to move out, and supply them with another UK address where to receive correspondence, they require proof that you actually live there.

[simoh1490]

1 minute ago, BritManToo said:

That was silly, best to keep quiet about where you are and what you're doing.

Agreed. that was a bad move. Best not to confirm the move perhaps, put it down to speculating and what if.

[simoh1490]

Just now, marcodigio said:

The problem with them is that if I were to move out, and supply them with another UK address where to receive correspondence, they require proof that you actually live there.

Mail forwarding 60 quid a year or so.

[marcodigio]

2 minutes ago, BritManToo said:

That was silly, best to keep quiet about where you are and what you're doing.

I expect you'll be contacting the state pensions people to freeze your pension as well.

Not to mention the NHS to cancel your coverage.

Well, I haven't got much of a choice. If they keep sending letters at my current address, and they get returned to sender as I'm not living there anymore, they are bound to find out. Cannot see a way out of it!

[marcodigio]

1 minute ago, simoh1490 said:

Mail forwarding 60 quid a year or so.

didn't know that! and you can do that indefinitely?

[simoh1490]

Just now, marcodigio said:

Well, I haven't got much of a choice. If they keep sending letters at my current address, and they get returned to sender as I'm not living there anymore, they are bound to find out. Cannot see a way out of it!

Pay an IFA before you leave, he can only take instructions from you when you're in the UK and he will cost you money but it is an option.

[simoh1490]

1 minute ago, marcodigio said:

didn't know that! and you can do that indefinitely?

https://www.royalmail.com/personal/receiving-mail/redirection/

[KittenKong]

8 minutes ago, BritManToo said:

I expect you'll be contacting the state pensions people to freeze your pension as well.

Not to mention the NHS to cancel your coverage.

To do otherwise would be benefit fraud, wouldn't it?

[marcodigio]

3 minutes ago, simoh1490 said:

https://www.royalmail.com/personal/receiving-mail/redirection/

From their terms and condition: "The maximum Redirection term is four years, including any extensions."

 

This would only delay the issue and not solve it.

[steve73]

I had been with i-dealing.com for about 7 years before leaving the UK in 2007.  They had no problem with me changing to a Thai address, although I could no longer contribute to my ISA (but obviously can still trade within it).  I've since added to my standard account, and as far as I can make out there are no capital gains tax or tax on dividends providing you meet the non-residence criteria (now effectively needing to be 5 years outside UK), and also to let the IR know when you leave.

But you need to consider carefully whether you may be better to remain UK tax resident and keep adding to your ISA (or at least switching from your non-ISA funds), especially now you can ring-fence 20k per year (it was only 10k when I left).

[simoh1490]

14 minutes ago, steve73 said:

I had been with i-dealing.com for about 7 years before leaving the UK in 2007.  They had no problem with me changing to a Thai address, although I could no longer contribute to my ISA (but obviously can still trade within it).  I've since added to my standard account, and as far as I can make out there are no capital gains tax or tax on dividends providing you meet the non-residence criteria (now effectively needing to be 5 years outside UK), and also to let the IR know when you leave.

But you need to consider carefully whether you may be better to remain UK tax resident and keep adding to your ISA (or at least switching from your non-ISA funds), especially now you can ring-fence 20k per year (it was only 10k when I left).

Posters need to look to the future also and think about the impact if the IK Personal Allowance is removed from non-residents, an event which is highly likely. FWIW I've just become UK resident once again following 16 years of non-residency, now at almost 70, the benefits of UK residency outweigh those of non-residency.

[steve73]

2 minutes ago, simoh1490 said:

Posters need to look to the future also and think about the impact if the IK Personal Allowance is removed from non-residents, an event which is highly likely. FWIW I've just become UK resident once again following 16 years of non-residency, now at almost 70, the benefits of UK residency outweigh those of non-residency.

But do you actually need to be resident to be tax-resident....? 

AIUI, even if you are tax resident, you don't get any benefits (fixed pension, not able to use NHS, etc) unless you are actually there for 6 months of the year... and after being away for so long I couldn't stand the British weather for long.

[simoh1490]

6 minutes ago, steve73 said:

But do you actually need to be resident to be tax-resident....? 

AIUI, even if you are tax resident, you don't get any benefits (fixed pension, not able to use NHS, etc) unless you are actually there for 6 months of the year... and after being away for so long I couldn't stand the British weather for long.

I do indeed live there six months each year, at least I did this year since I now have a flat on the edge of the Lakes, it was a truly great six months I have to say - even 7 degrees overnight in October was pleasant, snuggled up in a 14.5 TOG duvet, my wife loved it. I forgot add: the pensions people did uprate my pension and the US stopped deducting tax from my US Pension, the NHS was very welcoming.

Edited November 12, 2018 by simoh1490

[Spidey]

5 hours ago, KittenKong said:

To do otherwise would be benefit fraud, wouldn't it?

Benefit fraud is what the UK Government commit by refusing to pay the annual increase in pension to those living outside the EU.

[Spidey]

4 hours ago, simoh1490 said:

I do indeed live there six months each year, at least I did this year since I now have a flat on the edge of the Lakes, it was a truly great six months I have to say - even 7 degrees overnight in October was pleasant, snuggled up in a 14.5 TOG duvet, my wife loved it. I forgot add: the pensions people did uprate my pension and the US stopped deducting tax from my US Pension, the NHS was very welcoming.

I too have a flat on the edge of the Lakes. Have spent 6 weeks in it over the last 3 years, always in June. You're a hardier man than me, so is your poor wife!

[Spidey]

5 hours ago, marcodigio said:

The problem with them is that if I were to move out, and supply them with another UK address where to receive correspondence, they require proof that you actually live there.

I changed my address with my banks. Used bank statements with my new address on them to prove my new address to various parties.

[bouph12]

5 hours ago, marcodigio said:

I'm currently a customer of Hargreaves Lansdown. On top of a shares account I have a SIPP with them too. I will be more than happy to carry on using them if I move abroad, but after being reading all of their terms and conditions (sigh!), it's not entirely clear if you can carry on dealing as normal. I have contacted them, but still waiting for a reply. The last thing I would need is for my account to be frozen if I wasn't following their terms and condition. But surely there must be a lot of their SIPP customers who retired abroad? 

 

When I asked HL  about the 25% tax free amount from my SIPP they sent the forms to my home in Thailand where they know I've been living for several years. 
After I completed all the documentation and returned it, they refused to pay (without any prior warning) because of "New legislation". 
Both the Pension Advisory Service and  the Financial Conduct Authority were unaware of any such legislation. 
When I challenged HL on this, their story changed and their final response was:

 

"As you reside outside of the EEA, I am afraid that we cannot offer partial withdrawals from your HL SIPP, such as Drawdown. 
The options available to access your pension are taking a full withdrawal to close the account or transferring to a provider who can offer the service that you require.
 Please accept my apologies for any inconvenience this may cause."

 

The "Inconvenience" of closing the account would have cost me ten of thousands of pounds in tax. 
 I won't go into the ongoing problems I've experienced  trying to wrest my SIPP away from them, but at least I'll be saving plenty on fees with the company that will be getting my business. 

 

  

[marcodigio]

55 minutes ago, Spidey said:

I changed my address with my banks. Used bank statements with my new address on them to prove my new address to various parties.

Sorry which address did you use, a friend/family member? Or do you still have property in the UK where you get mail?

[KittenKong]

1 hour ago, Spidey said:

Benefit fraud is what the UK Government commit by refusing to pay the annual increase in pension to those living outside the EU.

They do pay the increase to people living in some countries outside the EU, but not to all. This is not fraud as the conditions of how and where they apply the increases are very clearly indicated, and have been for many years.

 

Fraud is lying to obtain a financial advantage, and that is what you appear to be proposing.

[Spidey]

33 minutes ago, KittenKong said:

They do pay the increase to people living in some countries outside the EU, but not to all. This is not fraud as the conditions of how and where they apply the increases are very clearly indicated, and have been for many years.

 

Fraud is lying to obtain a financial advantage, and that is what you appear to be proposing.

YMMV

[Spidey]

44 minutes ago, marcodigio said:

Sorry which address did you use, a friend/family member? Or do you still have property in the UK where you get mail?

I have a room in a friends apartment. He opens my mail and forwards it as necessary. However, I could just as easily have used my wife's or daughter's address.