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Topic Author
sublimelaconic
Posts: 20
Joined: Fri Aug 09, 2019 10:02 pm

Interactive Brokers Lite

Post by sublimelaconic » Wed Oct 02, 2019 3:44 am

So Interactive Brokers just announced IBKR Lite. The big thing for me (as someone who plans to start investing <$5,000 next year) is that the maintenance fees are now waived. Other notable change include: only fixed pricing for non-US stocks and ETFs.

Is there any catch? Will IBKR Lite be available for all countries (I'm from the Philippines)?

AlohaJoe
Posts: 4836
Joined: Mon Nov 26, 2007 2:00 pm
Location: Saigon, Vietnam

Re: Interactive Brokers Lite

Post by AlohaJoe » Wed Oct 02, 2019 4:19 am

sublimelaconic wrote:
Wed Oct 02, 2019 3:44 am
Will IBKR Lite be available for all countries (I'm from the Philippines)?
You can go to IB and check. It says where it will be available. It also lists the catches.

Topic Author
sublimelaconic
Posts: 20
Joined: Fri Aug 09, 2019 10:02 pm

Re: Interactive Brokers Lite

Post by sublimelaconic » Wed Oct 02, 2019 4:48 am

AlohaJoe wrote:
Wed Oct 02, 2019 4:19 am
sublimelaconic wrote:
Wed Oct 02, 2019 3:44 am
Will IBKR Lite be available for all countries (I'm from the Philippines)?
You can go to IB and check. It says where it will be available. It also lists the catches.
I'm checking here: https://www.interactivebrokers.com/en/index.php?f=45196

Where does it indicate the countries available and the catches?
EDIT: My bad, I guess it's only available for US and India :(

I found this but tbh I'm not sure what to make of it:
Accounts with a NAV of less than USD 100,000 (or equivalent) will be paid at a rate proportional to accounts with a NAV of USD 100,000 (or equivalent) or more. The proportion is determined by the ratio of the account's NAV to USD 100,000 (or equivalent). The negative rate applied to accounts holding these currencies is the same regardless of account size.
My understanding is I'll get less interest for my idle cash balance?

CarpeDiem22
Posts: 214
Joined: Tue May 22, 2018 11:20 pm

Re: Interactive Brokers Lite

Post by CarpeDiem22 » Thu Oct 03, 2019 2:03 pm

This finally makes Vanguard ETFs accessible for Indians like me who don't have $100k to invest (to avoid account minimums). Still two concerns:
1. Would have been better to buy Ireland-domiciled Vanguard funds rather than US-domiciled. (A learning thanks to this forum.)
2. What if I face some issue and need to take IBKR to the court? They do have local offices but not sure how permanent their presence is.

sharukh
Posts: 224
Joined: Mon Jun 20, 2016 10:19 am

Re: Interactive Brokers Lite

Post by sharukh » Thu Oct 03, 2019 9:39 pm

CarpeDiem22 wrote:
Thu Oct 03, 2019 2:03 pm
This finally makes Vanguard ETFs accessible for Indians like me who don't have $100k to invest (to avoid account minimums). Still two concerns:
1. Would have been better to buy Ireland-domiciled Vanguard funds rather than US-domiciled. (A learning thanks to this forum.)
2. What if I face some issue and need to take IBKR to the court? They do have local offices but not sure how permanent their presence is.
Hi,

By any chance have you found out Indian tax rules for Irish etf like vwrd iwda. I plan on buying one of those 2 as vwrd is distracting and iwda is accumulating.

Also with new rules one has to list full assets in tax filings if the money is held in these Irish etf. How safe is it to do that ?

Thanks

CarpeDiem22
Posts: 214
Joined: Tue May 22, 2018 11:20 pm

Re: Interactive Brokers Lite

Post by CarpeDiem22 » Fri Oct 04, 2019 6:08 am

sharukh wrote:
Thu Oct 03, 2019 9:39 pm
Hi,

By any chance have you found out Indian tax rules for Irish etf like vwrd iwda. I plan on buying one of those 2 as vwrd is distracting and iwda is accumulating.

Also with new rules one has to list full assets in tax filings if the money is held in these Irish etf. How safe is it to do that ?

Thanks
Sorry, haven't done my research on Ireland-domiciled funds. My comments was more about avoiding US taxation.
There is no issue in disclosing your foreign holdings in tax filings, as long as you are complying with laws. But in case you break any law by accident or lack of knowledge, don't expect to be let off easily without penalty as you'll be considered a person with enough surplus money (easy target for milking for authorities.).

sharukh
Posts: 224
Joined: Mon Jun 20, 2016 10:19 am

Re: Interactive Brokers Lite

Post by sharukh » Fri Oct 04, 2019 6:28 am

CarpeDiem22 wrote:
Fri Oct 04, 2019 6:08 am
sharukh wrote:
Thu Oct 03, 2019 9:39 pm
Hi,

By any chance have you found out Indian tax rules for Irish etf like vwrd iwda. I plan on buying one of those 2 as vwrd is distracting and iwda is accumulating.

Also with new rules one has to list full assets in tax filings if the money is held in these Irish etf. How safe is it to do that ?

Thanks
Sorry, haven't done my research on Ireland-domiciled funds. My comments was more about avoiding US taxation.
There is no issue in disclosing your foreign holdings in tax filings, as long as you are complying with laws. But in case you break any law by accident or lack of knowledge, don't expect to be let off easily without penalty as you'll be considered a person with enough surplus money (easy target for milking for authorities.).
Thank you.

CarpeDiem22
Posts: 214
Joined: Tue May 22, 2018 11:20 pm

Re: Interactive Brokers Lite

Post by CarpeDiem22 » Tue Oct 29, 2019 9:13 am

sharukh wrote:
Fri Oct 04, 2019 6:28 am
Thank you.
After some research for my own purpose, I have more info to share from India taxation perspective:

1. Capital gains from VWRD and IWDA will be treated similar to local debt funds for taxation. Capital gains are classified as short-term (STCG) if held for less than 3 years and long-term gain (LTCG) if held for 3 years or more. STCG taxed at your marginal income tax rate (as per income tax slab), and LTCG taxed at 20% with indexation (cost basis increases as per the official inflation index published by the govt).

2. Dividends from foreign holdings are added to your 'Income from Other Sources' and taxed at your marginal tax rate. (Domestic dividends on the other hand are subject to dividend distribution tax at 15% at source and tax-free in hands of the recipient up to Rs 10 L.)


I am looking for best ways for fund IBKR global account from India (Recipient is Citibank New York). Do let me know if anyone has any guidance. Thanks.

sharukh
Posts: 224
Joined: Mon Jun 20, 2016 10:19 am

Re: Interactive Brokers Lite

Post by sharukh » Sat Nov 09, 2019 7:13 am

CarpeDiem22 wrote:
Tue Oct 29, 2019 9:13 am
sharukh wrote:
Fri Oct 04, 2019 6:28 am
Thank you.
After some research for my own purpose, I have more info to share from India taxation perspective:

1. Capital gains from VWRD and IWDA will be treated similar to local debt funds for taxation. Capital gains are classified as short-term (STCG) if held for less than 3 years and long-term gain (LTCG) if held for 3 years or more. STCG taxed at your marginal income tax rate (as per income tax slab), and LTCG taxed at 20% with indexation (cost basis increases as per the official inflation index published by the govt).

2. Dividends from foreign holdings are added to your 'Income from Other Sources' and taxed at your marginal tax rate. (Domestic dividends on the other hand are subject to dividend distribution tax at 15% at source and tax-free in hands of the recipient up to Rs 10 L.)


I am looking for best ways for fund IBKR global account from India (Recipient is Citibank New York). Do let me know if anyone has any guidance. Thanks.
Very good summary. Thank you.

If you are going this route, may be check tax perspective for accumulating and distributing funds
IWDA doesn’t generate dividend where as VWRD pays dividends. May be, once past 3 years, the accumulated dividend gets better tax treatments of capital gains instead of marginal rates. Please let me know if you find any information about how accumulating funds are taxed.


For details about how to fund international IB account, you can see their presentation. It also has contact details
http://www.interactivebrokers.com/webin ... idents.pdf

Hope this helps

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