Hong Kong vs Singapore

[chilli42]

I have a meaningful investment level in common stock. Right now this is held by a US brokerage firm. As I an not a US citizen any longer (have not been for 12 years), I am looking to move my stock holdings to either Hong Kong or Singapore. On the surface, Hong Kong looks attractive as there is no capital gains tax on stock for residents and non residents (I would be a non resident). Anyone in a similar situation? Did you look at Singapore vs Hong Kong? Did you look at any brokers or banks? Are you happy (or not) with your choice. I am just at the stage of digging in and looking at options so just seeing what others experience has been for completeness.

[lkv]

Deleted.

Edited April 10, 2016 by lkv

[futsukayoi]

I went for Hong Kong and still feel that was the right choice. No tax and they make handling multiple currency or country transactions very easy and low cost.

[Kabula]

Good luck with the bear stock market!

[dibley69]

Good luck with the bear stock market!

Go short

[theguyfromanotherforum]

I thought you are a US resident for life especially when it comes to taxes.

[al007]

I went to CIMB Singapore also have Interactive Brokers if you want more info, PM me as I do not wish to discuss in open forum

[shadowmaster1971]

I have lived in SG and HK ( Still in HK as well Thailand).

I found HK better on Bank and a multitude of financial services.

Correct - there is no Capital Gains Tax in HK. Also HK is a territorial tax regime - you only pay tax on income earns in HK.

IN terms of bank for an investor the major banks - HSBC, Bank Of China, Standard Chartered, Hang Seng, Citibank, ICBC, BEA etc are good in offering all encompassing banking service.

I bank with Bank of China (Hong Kong) - meaning BOC HK operations not mainland BOC.

As a standard account holder of BOC (HK) I get the following:

Cheque a/c

Savings a/c

RMB account.

Online banking services

MTCN a/c - foreign currency bank account for up to 15 major currency. I can transfer from my savings/chque account into the MTCN or transfer with in the MTCN, 24/7 real time rates.

With my account and online services I get also the following:

- Precious metal account (paper account), trade online real time for gold, silver, platinum, copper as per market for HK, UK and US .

- Trade in physical gold.

- Trade shares on the main and secondary market of HK or subscribed to monthly investment plans to certain nominated prime HK stocks.

- Trade Shares on the Shenzhen & Shanghai markets ( I need to double check this)

- Terms deposits in $HK and most major currency.

- Trade government bonds.

- Trade on any managed funds, either in lump some amounts or do monthly savings plans into nominated managed funds.

- Trade currency online in real time for individual currency or cross rates hedging i.e. AUD vs US, etc, as well they offer a leverage service.

- Get notified of new IPOs and subscribed to those new IPO's regardless of what financial institution is handling the subscription.

- Overseas fund transfers (TT) online from either Savings, Cheque or whatever currencies currently held in my MTCN account to anywhere in the world.

- Obtain life, health, Travel, car, house insurance etc.

Lastly I get a BOC(HK) Union Pay ATM card like a visa/mastercard debit cards. It can be used like a credit card to make purchasers around the world - money is debited from savings/cheque account direct or RMB account if making purchase/ATM withdrawal in China. When i sue my Union Pay card for ATM withdrawals in Thailand I get charge recently on 50baht, now recently increased to 100baht.

Also note most banks in HK will require you to set a maximum ATM drawl limit especially for overseas transactions i.e., HK$20, 30 40k, depends on the bank, usually electronic transactions like inspires limited significanlty more running into 100s of thousands per transaction - again depends on the banks.

So as I mention above what I have is the basic service. Premium banking offer a lot more.

You can open such account above within a day in HK and can be done here through their offices in BKK for HK account opening.

[RachaRob]

_{I looked at Hong Kong and Singapore and ended up choosing Singapore. As a non resident I pay no taxes. Using UOB private banking.}

[1BADDAT]

I thought you are a US resident for life especially when it comes to taxes.

all you have to do is relinquish your citizenship.

[Poppadom]

I worked in SG for 5+ years and have my brokerage account there with Phillips. No capital gains tax, they handle multiple currencies on your customer account. Their Poems 2.0 interface is quite good. Can do most assets with them: stocks, ETF, CFD, FX, Unit trusts, etc. Used to use Citibank too, but their charges are ridiculous. If you are non resident, then you'll need to open a pre funded account, some of the charges:

0.7% for fund subscriptions (Citi had 3% initial sales charge!!!)

0.18% for SGX stocks (min S$25)

USD 20 flat for US markets (promotional fee - otherwise 0.3%, min USD 20)

Live market data for SGX is free, for non professional investors the rest are usually $2 per month, but for half a year now that's FoC as well.

Think if you execute min 2 transactions per quarter, they won't charge custody fees either.

Like them, no issues whatsoever so far.

Also you may want to as your potential new broker if they give you some rebate or special promotion for moving your assets to them. I know Phillips does cashback if you move unit trusts to them. Not big bucks though.

Edited April 11, 2016 by Poppadom

[Poppadom]

Slightly off, but still HK and SG and finanves, so let me ask - Guys anyone in HK/SG in financial services and is aware of vacancies, can you please PM me?

[chilli42]

Good luck with the bear stock market!

Thanks. Bear markets in Common Stock (and real estate) are my favorite time to invest. It's much, much easier to make money when you buy low and sell when it's up. That said, I almost never sell stock. I still have stick in companies I bought when I was 18 (and that was a very long time ago). That said, I do sell when it's clear I made a blunder.

[chilli42]

I thought you are a US resident for life especially when it comes to taxes.

No, only for ten years. The short version is that you first must renounce your US citizenship. Upon renouncing you must declare all your assets. Then you must file and pay US tax for a ten year period. Once the ten year mark is reached you are free and clear. I can tell you, it was a very nice feeling. One unfortunate twist was introduced a number of years ago. You are expected to pay tax on all taxable assets at the time you renounce citizenship. This can be a hefty bill if you own stocks/bonds, real estate etc.

[chilli42]

I have lived in SG and HK ( Still in HK as well Thailand).

I found HK better on Bank and a multitude of financial services.

Correct - there is no Capital Gains Tax in HK. Also HK is a territorial tax regime - you only pay tax on income earns in HK.

IN terms of bank for an investor the major banks - HSBC, Bank Of China, Standard Chartered, Hang Seng, Citibank, ICBC, BEA etc are good in offering all encompassing banking service.

I bank with Bank of China (Hong Kong) - meaning BOC HK operations not mainland BOC.

As a standard account holder of BOC (HK) I get the following:

Cheque a/c

Savings a/c

RMB account.

Online banking services

MTCN a/c - foreign currency bank account for up to 15 major currency. I can transfer from my savings/chque account into the MTCN or transfer with in the MTCN, 24/7 real time rates.

With my account and online services I get also the following:

- Precious metal account (paper account), trade online real time for gold, silver, platinum, copper as per market for HK, UK and US .

- Trade in physical gold.

- Trade shares on the main and secondary market of HK or subscribed to monthly investment plans to certain nominated prime HK stocks.

- Trade Shares on the Shenzhen & Shanghai markets ( I need to double check this)

- Terms deposits in $HK and most major currency.

- Trade government bonds.

- Trade on any managed funds, either in lump some amounts or do monthly savings plans into nominated managed funds.

- Trade currency online in real time for individual currency or cross rates hedging i.e. AUD vs US, etc, as well they offer a leverage service.

- Get notified of new IPOs and subscribed to those new IPO's regardless of what financial institution is handling the subscription.

- Overseas fund transfers (TT) online from either Savings, Cheque or whatever currencies currently held in my MTCN account to anywhere in the world.

- Obtain life, health, Travel, car, house insurance etc.

Lastly I get a BOC(HK) Union Pay ATM card like a visa/mastercard debit cards. It can be used like a credit card to make purchasers around the world - money is debited from savings/cheque account direct or RMB account if making purchase/ATM withdrawal in China. When i sue my Union Pay card for ATM withdrawals in Thailand I get charge recently on 50baht, now recently increased to 100baht.

Also note most banks in HK will require you to set a maximum ATM drawl limit especially for overseas transactions i.e., HK$20, 30 40k, depends on the bank, usually electronic transactions like inspires limited significanlty more running into 100s of thousands per transaction - again depends on the banks.

So as I mention above what I have is the basic service. Premium banking offer a lot more.

You can open such account above within a day in HK and can be done here through their offices in BKK for HK account opening.

That is very comprehensive. Thanks so much for taking the time to write that.

[lkv]

So where are you tax resident now?

[chilli42]

So where are you tax resident now?

I would rather not get into the details of this on an open forum. Suffice to say, I am not a US tax resident.

[lkv]

All right, well, there is a possibility banks in Singapore and Hong Kong will be asking you that question starting January 2017 in reference to the proposed implementation of the AEOI (automatic exchange of information), which means that if you are a tax resident of one of the many participating countries, the goverment of the participating country where you are a tax resident will get your bank account balance and depending on that country's tax law you may or may not be liable for tax.

Secondly, it's becoming more difficult but not impossible to open an account in HK as a non resident. SG is easier bur pricier.

Thirdly, further developments will have to be studied in the cases of SG and HK as we go along to better understand what their approach will be in regards to AEOI.

But for now, as a matter of personal choice, I would say HK.

Edited April 11, 2016 by lkv

[chilli42]

All right, well, there is a possibility banks in Singapore and Hong Kong will be asking you that question starting January 2017 in reference to the proposed implementation of the AEOI (automatic exchange of information), which means that if you are a tax resident of one of the many participating countries, the goverment of the participating country where you are a tax resident will get your bank account balance and depending on that country's tax law you may or may not be liable for tax.

Secondly, it's becoming more difficult but not impossible to open an account in HK as a non resident. SG is easier bur pricier.

Thirdly, further developments will have to be studied in the cases of SG and HK as we go along to better understand what their approach will be in regards to AEOI.

But for now, as a matter of personal choice, I would say HK.

Thanks for this, very helpful thoughts. I am leaning toward Deutche Bank in HK for the stock holdings and Interactive Trading for my hobby investing. I am OK with transparency as any Asian tax residence I end up with (likely Thailand) will not be taxing capital gains ... which is my main motivation for moving my stock holdings from the US to Asia. Dividends will be taxed regardless of where I live.

[lkv]

If your tax residence is Thailand, then it's good news because Thailand is not part of the AEOI agreement. In other words, HK banks are unlikely to share non participating countries information with the HK Gvt, starting 2018.

Singapore is discussing a wider approach, ie for all non resident account information to be shared with the SG Gvt, and for them to determine where that information goes, but it's in the stage of consultation and it remains to be seen how or if it will materialize.

But yes, I do believe HK is a better choice cost wise. It's as good as SG. SG is an excellent jurisdiction, but overpriced in my opinion.

PS: If Deutsche Bank is your focus and you meet their requirements, then they should be in a position to provide you with much better tax minimization advice than what you would get in this forum, perhaps even provide you with trustee services. But that's something to be discussed with your future dedicated account manager.

Edited April 12, 2016 by lkv

[Thailand J]

All right, well, there is a possibility banks in Singapore and Hong Kong will be asking you that question starting January 2017 in reference to the proposed implementation of the AEOI (automatic exchange of information), which means that if you are a tax resident of one of the many participating countries, the goverment of the participating country where you are a tax resident will get your bank account balance and depending on that country's tax law you may or may not be liable for tax.

Secondly, it's becoming more difficult but not impossible to open an account in HK as a non resident. SG is easier bur pricier.

Thirdly, further developments will have to be studied in the cases of SG and HK as we go along to better understand what their approach will be in regards to AEOI.

But for now, as a matter of personal choice, I would say HK.

Thanks for this, very helpful thoughts. I am leaning toward Deutche Bank in HK for the stock holdings and Interactive Trading for my hobby investing. I am OK with transparency as any Asian tax residence I end up with (likely Thailand) will not be taxing capital gains ... which is my main motivation for moving my stock holdings from the US to Asia. Dividends will be taxed regardless of where I live.

You are moving US stocks to Asia to avoid capital gain tax?

I’ve just looked at the instruction for 1040NR. Isn't it true Interests and dividends are taxed at 30% but capital gains arise from the sale of stocks are tax free?

[Crisu]

Singapore is discussing a wider approach, ie for all non resident account information to be shared with the SG Gvt, and for them to determine where that information goes, but it's in the stage of consultation and it remains to be seen how or if it will materialize.

thats interesting, but should be without meaning with a residence in thailand, because interest and capital gains is not taxed there anyway.

but what i not understand is, why should sg share this information with countries that do not participate the aeoi?

[chilli42]

All right, well, there is a possibility banks in Singapore and Hong Kong will be asking you that question starting January 2017 in reference to the proposed implementation of the AEOI (automatic exchange of information), which means that if you are a tax resident of one of the many participating countries, the goverment of the participating country where you are a tax resident will get your bank account balance and depending on that country's tax law you may or may not be liable for tax.

Secondly, it's becoming more difficult but not impossible to open an account in HK as a non resident. SG is easier bur pricier.

Thirdly, further developments will have to be studied in the cases of SG and HK as we go along to better understand what their approach will be in regards to AEOI.

But for now, as a matter of personal choice, I would say HK.

Thanks for this, very helpful thoughts. I am leaning toward Deutche Bank in HK for the stock holdings and Interactive Trading for my hobby investing. I am OK with transparency as any Asian tax residence I end up with (likely Thailand) will not be taxing capital gains ... which is my main motivation for moving my stock holdings from the US to Asia. Dividends will be taxed regardless of where I live.

You are moving US stocks to Asia to avoid capital gain tax?

Ive just looked at the instruction for 1040NR. Isn't it true Interests and dividends are taxed at 30% but capital gains arise from the sale of stocks are tax free?

It's true that dividends are taxed at 30% and there is no getting away from that. I have gone over 1040NR (the form from hell) and can't find anything saying capital gains are taxed or not. That said, I have searched other sources which claim capital gains for NR Aliens are tax exempt. Thanks for bringing it to my attention. It's a point I should look into further with a tax specialist.

[Naam]

It's true that dividends are taxed at 30% and there is no getting away from that. I have gone over 1040NR (the form from hell) and can't find anything saying capital gains are taxed or not. That said, I have searched other sources which claim capital gains for NR Aliens are tax exempt. Thanks for bringing it to my attention. It's a point I should look into further with a tax specialist.

no U.S. tax on capital gains for non-resident aliens. applies to any asset except immobile property located in the U.S.

note: if your present passport shows that you are born in the U.S. all HK and SG banks will demand recent dated evidence that you have renounced US-citizenship!

[lkv]

Singapore is discussing a wider approach, ie for all non resident account information to be shared with the SG Gvt, and for them to determine where that information goes, but it's in the stage of consultation and it remains to be seen how or if it will materialize.

thats interesting, but should be without meaning with a residence in thailand, because interest and capital gains is not taxed there anyway.

but what i not understand is, why should sg share this information with countries that do not participate the aeoi?

It's not sure yet what will happen. SG stated they will only participate in AEOI if the other major centers participate (HK, Dubai etc) so that's a question mark.

They stated they would prioritize the automatic exchange with countries with a strong rule of law. (they gave UK and France as examples).

No, the exchange will not happen with countries not part of the AEOI, what I am saying is that if AEOI happens in SG and HK, HK will likely let the banks filter the residency tax status of their clients, and forward that to the HK Gvt, whereas SG expresses an intent for the banks to forward all non resident info to the SG government and let the SG government do the filtering.

But everything is still in the air, as of now, in both places.

The tax residency status will be determined by banks automatically using electronic indicia for low value pre existing accounts, for new accounts a self declaration backed perhaps by proof of address, driving licence etc. For higher valued accounts (1M+ USD), the tax residency declaration will be required, or in cases where the existing electronic indicia proves conflicting, ie two addresses in the system, phone numbers from 2 countries, documentary evidence that does not prove the new address in the system,etc, the form would have to be completed by the client for pre existing low value accounts also (less than 1M USD).

A Tax Identification number would only be required if the tax residency country is part of AEOI. If it's not and it joins in the future, the TIN will be required at that time.

Edited April 13, 2016 by lkv

[Thailand J]

Capital gain from stocks may not have to be reported. See Page 47 of the 1040NR instruction:
“4. Capital gains in excess of capital losses from U.S. sources during 2015. Include these gains only if you were in the United States at least 183 days during 2015.”

I looked at 1040NR instruction again. It becomes a little easy once I understood what is “Income effectively connected to US trade” and what is not. You should be using page 4 of the 1040NR, not line 8-23 of page 1 for your interests and dividends from stocks as a NR.

Except sales of immobile assets such as houses are to be reported on Schedule D and line 14 on page 1 and will be taxed..

It is better to consult a tax specialist, hopefully you’ll find one better than the one I’ve used.

Edited April 13, 2016 by Thailand J

[Naam]

what part of

You may need to file Form 1040NR if you:

• were a nonresident alien engaged in a trade or business in the United States,
• represented a deceased person who would have had to file Form 1040NR, or
• represented an estate or trust that had to file Form 1040NR.

is it you people don't understand?

[chilli42]

what part of

You may need to file Form 1040NR if you:

• were a nonresident alien engaged in a trade or business in the United States,
• represented a deceased person who would have had to file Form 1040NR, or
• represented an estate or trust that had to file Form 1040NR.

is it you people don't understand?

I am not understanding why Merrill Lynch in the US withheld tax on options and shares I sold last year when they know that I am a non resident alien. If they were incorrect, then I need to file a 1040NR to get a refund. ,any also be time to change broker.

[Thailand J]

Now that you know your capital gain may be tax free in US are you still considering HK or SG? 
Unlike 1040, you don’t need to file 1040NR if the withholdings correctly matched your tax liabilities. You need to file 1040NR if not all of the tax was withheld or you have a refund. You must attach a copy of the Form 1099 that shows the income and the amount of backup withholding, and wait much longer then 1040 refunds

[chilli42]

Now that you know your capital gain may be tax free in US are you still considering HK or SG?

Unlike 1040, you dont need to file 1040NR if the withholdings correctly matched your tax liabilities. You need to file 1040NR if not all of the tax was withheld or you have a refund. You must attach a copy of the Form 1099 that shows the income and the amount of backup withholding, and wait much longer then 1040 refunds

If the capital gains on stock and similar investments is not taxable, would keep my certificates in the US. Though I will be moving them out of Merrill Lynch ... where the cost is high and service average.