UK resident trading with a US broker tax issue

[rahus]

Hey guys


I guess this question would be for ppl who are resident in the UK and have a US broker through which they trade.

Tax related question..

My US Broker will not take a UK address (I have funded the account wth a US Bank Account my broker namely Scottrade {ya i know}) so my Form 1099 Statement has a US add on it.

Now obviously when I fill in my non resident filing with the IRS I have a UK add

I dont know if this would cause a problem with the IRS.

If anyone has had any experience filing US taxes being a UK resident while using a US broker if you could please reply

even if it doesnt ans my question.

Tired of calling the IRS and Tax Consultants without getting an answer.

Thanks

 

[Pippppin]

Hey guys


I guess this question would be for ppl who are resident in the UK and have a US broker through which they trade.

Tax related question..

My US Broker will not take a UK address (I have funded the account wth a US Bank Account my broker namely Scottrade {ya i know}) so my Form 1099 Statement has a US add on it.

Now obviously when I fill in my non resident filing with the IRS I have a UK add

I dont know if this would cause a problem with the IRS.

If anyone has had any experience filing US taxes being a UK resident while using a US broker if you could please reply

even if it doesnt ans my question.

Tired of calling the IRS and Tax Consultants without getting an answer.

Thanks

I am a tad confused by your message Rahus. It appears you are resident in the US (Texas?) and are using a US broker - thus you have to file for US taxes with the IRS

I am a UK resident using the US broker OptionsXpress (more expensive than Scottrade but in a different league relatform and customer service I think). I file for UK taxes, not US taxes

Please correct me if I have failed to grasp the nub of your problem

 

[rahus]

I am a tad confused by your message Rahus. It appears you are resident in the US (Texas?) and are using a US broker - thus you have to file for US taxes with the IRS

I am a UK resident using the US broker OptionsXpress (more expensive than Scottrade but in a different league relatform and customer service I think). I file for UK taxes, not US taxes

Please correct me if I have failed to grasp the nub of your problem

haha ya my profile says texas, I used to live there as a student and employee but I've moved back to the UK and am a resident of the UK now (no US green card etc etc).

The thing is I have a US bank account and I dont mind keeping my gains in the US. If I recieve dividends I need to pay 15% tax to the US govt , thats why I have to also file a US tax return, even though I understand that your capital gains is not taxed in the US and only taxed in the UK

Hope that clarifies things a bit

 

[Technically Fundamental]

Thats a nightmare. You might have to pay file us and uk. you need specialist advice

 

[timetotrade]

Surprised your broker will not accept a non US address. I have a US broker account and as non US citizen and non US resident am required to complete a form W-8BEN which is sent to the broker (not the IRS). I've not had any direct dealings with IRS. The W-8BEN states you are a foreign person and so exempt from US taxes, and subject to UK tax under the double taxation treaty.

If you are UK domiciled and UK resident you'll be expected to file in the UK - and you will have to declare your dividends, and be subject to UK capital gains on:
1) the gains you make from trading your US broker a/c (calculated using appropriate exchange rates on the dates of purchase/sale), and
2) currency gains when you move money back to UK.

If you're non-UK domiciled, then that's another matter again.
As Technically Fundamental rightly said ..it's a nightmare.

These websites might help: TradersTaxClub and HMRC

 

[airmark]

I've had similar experience, coincidentally with Scottrade as well. Filed both US and UK tax returns for a couple of years, and eventually when I mentioned to Scottrade that I now live in the UK, they said they have to close my account as they can't knowingly cater to non-US residents. So I transferred my account to Firstrade (the cheapest US broker I found that would accept a UK based client) and continue to file tax returns in both countries.

 

[safvan]

Firstrade.com and InteractiveBrokers.com are the only two discount brokers alive that would accept international clients.

For small international non US residents Firstrade.com is the best option. I have used them since 2007. If you are not a high volume day trader that requires 50 transactions a day then nothing beats firstrade for an international account when it comes to discount brokerages.