Hi all, curious about the mechanics here for anyone who has knowledge of cross-border investing.
If someone has held a UK global tracker fund for 15 years and then becomes a German tax resident, what are the general options typically available to them, and what are the trade-offs of each?
For example: continuing to hold the existing fund, opening a new account with an equivalent fund, selling and reinvesting, or doing an in specie transfer to a broker like IBKR.
If you moved country would you move your portfolio too?
byu/MikeThePenguin ininvesting
Posted by MikeThePenguin
1 Comment
I am not familiar with investing in Europe and the UK, but when I moved from my home country to the US, the accountant recommended me _very warmly_ to liquidate my assets and re-buy them in the US. The reason for that is that the brokerages publish tax reports according to the tax rules of the country where they are situated, so if you keep your holdings aboard, it will be very difficult and expensive to pay taxes in your country of tax residence.
Examples (again, not EU/UK): US taxes long- and short-term securities (held for over or under a year) differently. The annual report abroad won’t have this break-down, I would have to go over all sales and dividends and do the math manually. Another example: my country doesn’t tax reinvested dividends until liquidation, so the underlying indexes for all index funds are total-return. For the US tax report, I would need to pay the tax each year and then, for each reinvested lot, keep track of a second cost basis, and the brokerages won’t help me.