Bogleheads.org

daviddem wrote: ↑Wed Mar 15, 2023 3:17 am

jjmaddison wrote: ↑Tue Mar 14, 2023 3:20 pmThe one with 0.15% ER, right?

Please note, we're talking about IBIE, not IBUS.

Yes, there are others with a 0.1% management fee but the min purchase is a LOT more. At current prevailing interest rates, it yields about 4.8% over a year (for the ACC version).

0.1% would be better, of course, especially if the liquidity is also good.
The senior person who asked this question has 6 digits in their numbers for this purpose, should be enough to buy, I guess.

Is there a link to see the possible options, maybe? Like etfdb?

The Client Assets Key Information Document from IBIE should answer your question.

According to this document, IBIE has a lot of freedom in how it keeps the money, and the money is insured only up to €20.000, right?

P.S. The inheritance question is still hanging, is it?
"Just don't die" is the most favorable option for sure

Thank you!

This was only about ETFs, right?

What's with the money on IBIE brokerage account?

IBIE is a wholly-owned subsidiary that sits within the broader Interactive Brokers Group.

That usually means that IB Group owns IBIE.

But IBIE is in Ireland and is subject to Irish legislation.
They withhold taxes according to Irish legislation.

Probably Irish inheritance taxes will apply.

Ireland has Gift and Inheritance Tax (Capital Acquisitions Tax – CAT)
https://www.revenue.ie/en/gains-gifts-a ... index.aspx

It looks to be quite harsh on inheritance (-33%, no lower bound), is there any reason why it doesn't apply to money in IBIE?
Also, why it doesn't apply to ETFs in IBIE?

P.S. This question is covered so carefully for IBUS, must be some explanation for EU guys' IBIE too

daviddem wrote: ↑Fri Mar 10, 2023 7:50 am The best way to remove that risk (for residents of most countries) is to invest in an Irish-based USD money market fund. The best one I found available on IB (min purchase / redemption of USD 150,000) is the Invesco US Dollar Liquidity Portfolio Institutional mutual fund: https://www.interactivebrokers.co.uk/po ... /389538961

The one with 0.15% ER, right?

Please note, we're talking about IBIE, not IBUS.

Did I understand correctly that, except value fluctiation (quite low for 3-month bonds), the yield is 4.69% or more"?

The prospect says "Yield to worst".

The yield for VDST appears to be a bit higher, 4.69%, no?

Laurizas wrote: ↑Mon Feb 27, 2023 4:02 am I looked at Vanguard U.S. Treasury 0-1 Year Bond UCITS ETF (USD) Accumulating ISIN IE00BLRPPV00, WKN A2P66X and Invesco US Treasury Bond 1-3 Year UCITS ETF A ISIN IE00BF2FNG46 and they give same yield as IBKR

https://api.fundinfo.com/document/c7429 ... -01-31.pdf

https://api.fundinfo.com/document/d532d ... -01-31.pdf

A senior lives in the Netherlands, they have considerable amount of USD on their IBIE account and intend to keep it for about 6-12 months.
They don't want to buy stocks, but rather keep it as cash or something alike.

Right now IB pays 4.08% on USD.

Should they buy US Treasuries instead? I heard, they have higher yields now?
Or maybe even a short-term bonds ETF?

Short-term bonds won't suffer as FED increases the rate, but maybe longer-term bonds on the secondary market have the "rate increase" expectation in their price already?

I know a few things about bonds, but kind of lost, there're so many kinds of them.
Thank you, guys!

For some reason I wasn't notified about the reply, so sorry for the delay. Here we go, Dutch stuff. There be specific terms and dragons. 1) No Capital Gains tax. You know that, right? 2) Want to use the 30% ruling? (sure you do) Then you can't claim benefits of double taxation agreements. I am aware of 1). Not so much about 2) :confused Could you redirect me where I can read more in this, please? I have an official letter from Dutch tax inspection about that. Also I talked to them on the phone. Those who get 30% ruling can choose to become partial non-residents of the Netherlands and pay no tax on worldwide wealth and dividend-like income (box 2 and box 3). In fact, you may declare that you want to be a full resident, but then you have to p...

Hey, man, I just had the same situation, moved to NL from outside the EU. So here's to all who move to the Netherlands and don't have US residency. 1) No Capital Gains tax. You know that, right? 2) Want to use the 30% ruling? (sure you do) Then you can't claim benefits of double taxation agreements. => USA reaps 30% withholding tax from dividends. => Ireland takes 20% (or maybe 15 not sure) from cash interest. => For Irish-domiciled funds, distributing vs accumulating makes no difference except that accumulating might be more convenient (reinvests automatically and faster). Let me know if you have other questions. I use IB IE for investing. P.S. There's also an expat pension scheme here, something like 401(k) in USA or maybe ISA, you might ...

DoctorE wrote: ↑Tue Jan 24, 2023 4:05 pm Pitfall: 2x leverage = lose 100% of your money.

The maintenance margin requirement for E-mini SP500 futures is quite low.

To loose all money on 2x... The drawdown must be the biggest in last 100 years of history.
Not sure, which exactly, because maintenance tends to increase in times of crisis.

(actually I'm also worried that 2x might be too much)

Hello, I'm seriously thinking about leveraging my SP500 investment to 1.5-2x in near future. For me, it's still 25+ years till retirement. Hopefully, such leverage isn't that big and will allow to survive coming downturns. I've read many messages on this forum about leveraging, and it appears that futures represent the cheapest way to do it. Tax-wise, stocks / futures are the same to me. Does "E-Mini S&P 500 Future Continuous Contract" look like a good choice? I traded futures many years ago, and these were fixed-date contracts, not sure what a "continuous" is, any pitfalls? Also, what happens with dividends then? If I own real stocks, e.g. via an ETF, then it pays out or reinvests dividends. Holders of futures, natu...

What is stopping you from selling VOO, BND and so on and replacing them with equivalent UCITS ETFs, typically Ireland domiciled? I'm choosing between Irish-domiciled VUAA/VUSD instead of VOO, does it seem a good idea? They appear to be the same, but VUSD is distributing, while VUAA is accumulating. Which one is better? Assuming that I don't pay dividend tax in the Netherlands, but also that double-taxation treaty doesn't work for me - are they same, tax-wise? Beyond that, assuming 1 is right, can you move your IB account to a country that doesn't tax interest paid to nonresidents? I can't move my IB account, because those who live in the Netherlands are served by IB IE branch, there's no choice here. I could move my assets to another broke...

TedSwippet wrote: ↑Wed Jan 11, 2023 8:10 am Can you clarify which of these:

• US domiciled ETFs held in an Interactive Brokers account that is based in Ireland (does such a thing exist?).
• Ireland domiciled ETFs held in an Interactive Brokers account based anywhere.

Right now I hold VOO, BND and few other US-domiciled ETFs, the 1st option.
I bought them before moving to the Netherlands, when I was a client of another IB branch, and then transfered to IB IE (now I can't buy these).

So far, it looks like:

1) Ireland holds some of cash interest (20%?)
2) USA holds 30% of dividends (no tax treaty)
3) No capital gains anywhere.

Does this seem correct?

Hello,

I recently moved to work in the Netherlands and applied for 30% ruling here.
This powerful tax feature allows me to avoid paying local taxes on worldwide savings and dividends. No "wealth tax" for me. At least for the nearest 5 years. Thanks, Netherlands!

Although, here comes a problem.
The double-taxation treaty between Ireland and the Netherlands doesn't apply to me.

So now I own US-based (Vanguard) ETFs via Interactive Brokers Ireland, and I'm kind of confused, how much taxes should I pay to Ireland?

1) 15% or 20% or 25% of interest of cash?
2) Anything on dividends?
3) Anything on capital gains?

I'm not a resident of Ireland, but I also can't use a DTA, so kind of lost here.

Sorry for necroposting

So does it make sense for a Dutch investor to switch to a swap-based ETF for SP500, at the end of 2022? =)

Or keep a regular, replication-based one...

sean.mcgrath wrote: ↑Fri Nov 04, 2022 5:19 am Why did you conclude this. Do you mean in the Netherlands?

Yes, in the Netherlands, there'll be no taxes on dividends from ETF.

USA withholds 15% tax from dividends paid by US companies.

So, I won't be paying dividend taxes, as I'm in the Netherlands. Sounds cool.

Does that make the tax load for SP500 ETFs is the same for distributing versus accumulating ETFs?

E.g. VUSD compared to VUAA, both are Irish USD-denominated SP500, full replication, ER 0.07%.

1) For VUSD (distributes), there's 15% withholding in USA, and no more taxes.
2) For VUAA (accumulates), there's 15% withholding USA, then the fund reinvests the dividends, and also no more taxes.

As a non-expert, I hope I did't miss something important here.

Thank you, TedSwippet,

Looks like I need to understand Netherland taxations of US funds, so I corrected the original message.

I recently moved to reside in the Netherlands, non-US citizen.
I also have 30% ruling as an expat here, so I'm not taxed on worldwide box 3.

I used to have VOO on my IB account, trying to understand the taxation.

1) There' a 15% withholding tax in USA, is it?
2) Dividends from VOO belong to box 3, do they?
3) That 15% tax withheld in USA - can I use it to lower my income taxes (box1) ?

So, the option may be to buy a Canadian QEF for SP500, as there are no European QEFs?

Then it will be the same as buying a US-domiciled fund for the purposes of reporting and taxation?

TedSwippet wrote: ↑Sat May 16, 2020 3:46 am

jjmaddison wrote: ↑Sat May 16, 2020 3:31 am - Distributing (VUSD) pays me dividends taxed according to my country/Ireland treaties?

Not quite. VUSD just pays you the full dividend from the ETF (although of course the ETF has already paid 15% tax to the US). Ireland does not tax dividends paid to non-Irish residents by Ireland domiciled funds and ETFs (Ireland domiciled ETFs are fully 'tax-transparent'), so any tax treaty between your country and Ireland is irrelevant.

So I get full dividends from VUSD, and must pay my country standard dividend tax on that, right? Without taking any tax treaties into consideration.

So, for both of these funds, there's already 15% tax on dividends paid to US, and then?..

Do I get it right that
- Accumulating (CSPX) doesn't pay me dividends, so I only have capital gains when sell,
- Distributing (VUSD) pays me dividends taxed according to my country/Ireland treaty?

Hi,

I'm thinking to buy S&P 500 UCITS ETF Distributing or Accumulated (VUSD or CSPX).

My country has a treaty with US for 10% on dividends.

What's better money-wise: buy accumulated (CSPX) or buy distributing (VUSD) and purchase more for the dividends manually?

P.S. It looks like VUSD is better, as the dividends tax is 10% compared to 15% Ireland/USA tax for CSPX? Is that correct?

Thanks for the link!

Looks like CSPX is the best choice for a liquid SP500 Accumulating non-US ETF?

Also, are CSPX and VUAG (from the same link) exactly the same thing, from different companies?
I see their performance differs in hundredths of %.

Hi, (asking on behalf of another person)

I'm US resident, but my heirs are not. So I'd prefer buying non-US ETF to avoid the estate tax.

However, I've briefly heard about US PFIC tax rules, that there's a heavy tax burden and such, but don't know the details (will educate myself).

I intend to make a long-term investment for 10+ years.

Is it a really bad idea, so I must give up and buy a US ETF instead? =)

What you'd recommend instead? VUSA?

Synthetic uses derivatives instead of actual stocks.
I wonder, is that CFD or something else?

Is there any actual difference?

Hi,

Being a non-US resident, I'm concerned about the estate tax, and would like to buy SP500 in a safe manner.

Looks like Invesco S&P 500 UCITS ETF is a good candidate? ER 0.05%

I couldn't find a lot about that particular ETF here and on the Wiki, is there anything wrong with it?

Here's the info:
- https://etf.invesco.com/gb/private/en/p ... nformation
- https://www.justetf.com/en/etf-profile. ... 00B3YCGJ38

P.S. I guess, this is traded in EUR in LSE?
P.P.S. The bogleheads wiki recommends another ETF with higher ER, I'm confused.

Hi,

silverex: does that change anything? Sorry for my ignorance if the issue is obvious

The local laws are ok with that. E.g. on my death, my spouse inherits me, all right.

If I get it correctly, the main problem is about the taxation of US assets exceeding $60k.

The topic author barilla555 finally decides that the 3rd option is a "red flag". But is it?

Looks like inheriting non-US assets with IB isn't a problem?

Here're the words of IB: "Use the Transfer on Death page to register one or more beneficiaries (called “TOD Beneficiaries”) to whom you want to directly pass your account assets upon your death without having to go through probate."

Taken from https://www.interactivebrokers.com/en/s ... ndeath.htm.

Does that make IB USA a good choice for a non-resident, assuming they buy a non-US domiciled ETF, such as VUSA?

About the option 3, what's so bad in it?

When you buy non-US domiciled ETFs at IB in USA, are they the subject of the US estate tax?

Hi, One of the things that I read regularly on this forum is: "rebalancing is good, because you sell high buy low (stocks go up you rebalance sell stocks buy bonds and vise versa)". Or, like this: "having bonds is good, because you rebalance to stocks (buy cheap) in case of a crash". Is that really true? Smells like timing the market. Rebalancing should happen yearly? Monthly? On sharp dips? Did anyone test things like "100% equity" vs "80/20 plus yearly rebalancing" using a portfolio modelling tool or something? P.S. I tried https://www.portfoliovisualizer.com/monte-carlo-simulation, it shows 100% equity is ~25% better, not sure how they handle rebalancing though. P.P.S. This exact question refers to...

If I planned to retire in 5 years, I'd have 50/50 or kind of.
But 15 years is so much more vague.

Hello,

I plan to retire after 15 years.
Is it ok to have 100% in stocks, or 95% stocks/5% bonds in that case?

I'm kind of tolerant to risk, but was not invested in 2007 and the 1929, so don't know for sure

Looks like most people talk about 80-/20+ here.

Hello,

In my country I pay around 13% tax for any profit: capital gains or dividends.
The tax scale is plain: same 13% for any income.

Would you recommend Vanguard ETFs for a 3-fund portfolio or maybe something else that reinvests dividends (also taking ER into account)?

Thank you.

Hi,

I'm considering a 3-fund portfolio from the Bogleheads wiki: https://www.bogleheads.org/wiki/Three-fund_portfolio

This forum seems to recommend Vanguard.
But when I compare current State Street SPDRs (THRK/CWI/BNDS) expense ratio against Vanguard (VTI/VXUS/BND) - every SPDR ETF has a bit lower ER.
Right now I pay the same commission for both.

Is there anything that makes Vanguard more preferable here, or just go SPDR?

P.S. I apologize if my question is really newbish and the answer is obvious.

People have been predicting a bond crash since 2009, pointing out (correctly) that interest rates could only go up. It hasn't happened yet. Most here think that the effect of rising interest rates on bond prices will probably be small and temporary, and that for the bond investor over the long-term higher interest rates will be good. We still hold intermediate-term bond funds, and don't plan to change that. Watch the "Bond King", Jeffrey Gundlach, in the video in this link. Well worth the 20+ minutes to hear his thoughts about interest rates, bonds, and bonds as an investment: https://www.vanityfair.com/news/2017/10/jeffrey-gundlach-volatile-bond-market Spoiler alert: Jeff does not like bonds. Thank you, it was interesting to wat...

I keep hearing the stocks are "full valuated". And the market is so high. Not a good time to buy stocks?

The interest rates will probably go up (per Fed announcements), so bonds probably will go down a bit. When I look at BND, there's no gain for the last year. Not a good time to buy bonds?

Maybe it's time to start saving money in cash (USD), how you think?