Trading in UK shares as a non-resident

[marcodigio]

1 hour ago, bouph12 said:

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:

 

  

Wow, that would drive me nuts! And to think that a big part of their marketing is proposing to people that wants to build a SIPP to retire abroad. Just last week I downloaded their brochure about retiring abroad, and they have clearly omitted about not being able to use the drawdown facility. 

Were you able to find a provider that lets you use that facility? 

[simoh1490]

2 hours ago, marcodigio said:

Wow, that would drive me nuts! And to think that a big part of their marketing is proposing to people that wants to build a SIPP to retire abroad. Just last week I downloaded their brochure about retiring abroad, and they have clearly omitted about not being able to use the drawdown facility. 

Were you able to find a provider that lets you use that facility? 

A couple of years ago I took this issue up with the UK Financial Conduct Authority and with Baroness Altman who was UK Pensions Minister at the time, I wanted to know what expats were supposed to do in respect of getting the services of an onshore IFA and share dealing and execution services, as they related to expat pensions. The FCA was most helpful and did a mini-investigation, Chris Woolard their Director of Strategy confirmed there is NO legislation, rules or guidelines in place whatsoever that prohibits either UK based IFA's or share dealing companies from offering their services to non-resident expats - Ros Altman did ask around but couldn't give me a straight answer, she reckoned the whole issue was insurance related whereby expats represented a higher insurance risk (as if that makes any sense). She did however point me at a couple of UK based IFA's who will deal with expats but they in turn use offshore expats IFA's based in Italy and Spain for this purpose hence there is no UK legislative protection if you use them, because they are expats who are offshore! She also pointed me at Intermax in Luxomberg for share dealing services since they will deal with expats.

[KittenKong]

3 hours ago, simoh1490 said:

Intermax in Luxomberg

That's Internaxx for anyone wanting to search for them.

 

Like ii, they should work out a lot cheaper than HL for most investors.

[KittenKong]

3 hours ago, simoh1490 said:

Ros Altman did ask around but couldn't give me a straight answer, she reckoned the whole issue was insurance related whereby expats represented a higher insurance risk (as if that makes any sense).

I think it's much more likely to be that the brokers simply dont want the hassle of having to research and comply with all sorts of legislation from all sorts of tin-pot little countries where they may only have a couple of customers resident. This is exactly the same reason why many UK banks wont accept non-resident depositors: they simply cant be a*sed.

[bouph12]

19 hours ago, marcodigio said:

Wow, that would drive me nuts! And to think that a big part of their marketing is proposing to people that wants to build a SIPP to retire abroad. Just last week I downloaded their brochure about retiring abroad, and they have clearly omitted about not being able to use the drawdown facility. 

Were you able to find a provider that lets you use that facility? 

I am transferring to A.J. Bell. They assure me that a SIPP's drawdown conditions will be applied as if I were in the U.K., as per the Pensionwise guidelines. It's a nice bonus that it will be cheaper to maintain.  

HL have taken thousands of pounds in fees over the last 8 years I've been living abroad. if they weren't going to provide a full service, they really should have made that information available to me.    

 

12 hours ago, KittenKong said:

That's Internaxx for anyone wanting to search for them.

 

Like ii, they should work out a lot cheaper than HL for most investors.

I have an account with Internaxx which I opened earlier this year. There is no access to popular U.K. funds from the likes of Lindsell Train or Baillie Gifford, but there are fund options from Invesco, Jupiter, Morgan Stanley, et al. If ETFs are your preference, there are several thousand available, including the Vanguard range. Share dealing covers 18 different exchanges.

It's a useful option for an expat.      

[topt]

13 hours ago, KittenKong said:

Like ii, they should work out a lot cheaper than HL for most investors.

That surprises me but it may have changed since I looked at them about 5/6 years ago. I may have to revisit it - thanks. 

 

By the way I looked at HL vs II charges fair;ly recently and agreed HL generally much more expensive but specifically looking at a SIPP, and from memory drawdown costs, there was a definite sting in the II tail when compared to HL - I cannot find my notes so don't quote me but it was enough to stop me opening a SIPP.

 

[KittenKong]

1 hour ago, topt said:

By the way I looked at HL vs II charges fair;ly recently and agreed HL generally much more expensive but specifically looking at a SIPP, and from memory drawdown costs, there was a definite sting in the II tail when compared to HL - I cannot find my notes so don't quote me but it was enough to stop me opening a SIPP.

I probably should have qualified my statement to include only investors with a standard share account. As far as I know SIPPs and ISAs have specific rules and charges that apply only to them. I've been non-resident for 40+ years so I've never been concerned with those types of account.

 

I was comparing the HL custody charge (or maintenance charge or account charge or whatever they call it) of .45% on a portfolio value up to £250,000 - which could amount to £1,125 - and the equivalent ii charge which is under £100, and which takes the form of a trading credit anyway. That's a hefty saving.

 

Individuals should, of course, read the small print carefully in order to get the best value for their particular needs.

[topt]

14 hours ago, KittenKong said:

I was comparing the HL custody charge (or maintenance charge or account charge or whatever they call it) of .45% on a portfolio value up to £250,000

KK you realise that figure is only on funds in a non ISA/SIPP account - which I agree is high.

For shares, Investment Trusts, ETFs, VCTs, gilts and bonds holdings there is no account charge in the ordinary trading account.

https://www.hl.co.uk/investment-services/fund-and-share-account/charges-and-interest-rates

[KittenKong]

9 hours ago, topt said:

KK you realise that figure is only on funds in a non ISA/SIPP account - which I agree is high.

For shares, Investment Trusts, ETFs, VCTs, gilts and bonds holdings there is no account charge in the ordinary trading account.

That's odd. I wonder if they have changed that? I'm sure that when I checked a few years ago the charge was levied on all holdings outside of the special accounts.

 

Either way, I find ii charging to be much more straightforward: it's capped at under £100/year and the charge takes the form of a trading credit and so may drop to zero for anyone who trades a few times a year.

Edited November 14, 2018 by KittenKong

[steve73]

13 hours ago, KittenKong said:

That's odd. I wonder if they have changed that? I'm sure that when I checked a few years ago the charge was levied on all holdings outside of the special accounts.

 

Either way, I find ii charging to be much more straightforward: it's capped at under £100/year and the charge takes the form of a trading credit and so may drop to zero for anyone who trades a few times a year.

I was looking at HL's self-invest platform just a few months ago (trying to encourage my kids to start investing as a way to become more aware of global economics), and I'm pretty sure the fees was for all holdings even then... Or maybe I misread.. But I ended up going to i-dealing at 5GBP/qtr in admin fees, but with no offsetting.

Edited November 15, 2018 by steve73

[topt]

On 11/15/2018 at 1:24 PM, steve73 said:

Or maybe I misread..

Check the link I posted or this one - https://www.hl.co.uk/shares/share-dealing/dealing-charges

 

But yes if in an ISA then the fee is on the lot but is capped.

[KittenKong]

2 hours ago, topt said:

Check the link I posted or this one - https://www.hl.co.uk/shares/share-dealing/dealing-charges

Yes, those are the current prices and they are indeed as you say. But I'm sure that when I last checked (I think it must have been about 18-24 months ago) the account charge seemed to be applied to shares and ETFs also, and not just funds.

Looking back in the press I find several announcements of different HL price changes over the last 5 years or so. It's really quite confusing.

[steve73]

4 hours ago, topt said:

Check the link I posted or this one - https://www.hl.co.uk/shares/share-dealing/dealing-charges

 

But yes if in an ISA then the fee is on the lot but is capped.

Thanks... Yes - I was looking at the ISA costs (for my kids).