Non-US frequently asked questions

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Ambox globe.svg This article contains details specific to global investing. It applies to non-US investors, United States (US) investors, and US citizens and US permanent residents (green card holders) living outside the US.

Non-US frequently asked questions organises non-US wiki pages as a series of Frequently Asked Questions (FAQs). You can use these to help you quickly identify which non-US focused pages in the wiki may contain information of interest. You can also use the 'Search Bogleheads' box above.

When following links in the wiki, you can reach pages that do not apply to you as a non-US investor. A banner at the top of a page may indicate that a page is specific to US investors. Pay particular attention to any pages that recommend specific US funds or US domiciled ETFs. These investments may have harmful US tax consequences if held by some non-US investors.


Getting started

Q. What is this site about, and why should I care?

A. Simple investing principles. These principles have historically produced better risk-adjusted returns than those of average investors.

See: Bogleheads® investment philosophy for non-US investors, and Getting started for non-US investors.

Q. How do I get started?

A. Get organised. Take time to understand the concepts. Invest with simplicity. And ask for help if you need it.

See: Bogleheads® investing start-up kit for non-US investors, and Non-US Investing Forum.

For all non-US investors

Q. What is a non-US investor?

A. A non-US investor is someone who is not a US resident (under the IRS 'substantial presence test'), not a US citizen, and not a US permanent resident (green card holder).

See: Investing from outside of the US, and Domicile.

Q. I read the "Bogleheads guide" and US wiki pages. Why can't I buy the mutual funds they recommend?

A. These are US domiciled mutual funds, and are designed to be held by US investors. Your own country's mutual funds (or local equivalent) will be more appropriate.

See: Index funds and ETFs outside of the US.

Q. I read the "Bogleheads guide" and US wiki pages. Should I buy the ETFs they recommend? For example, VT, VTI, or BND.

A. Because of unfavourable US tax rules, unless you live in one of the few countries with a good US estate tax treaty, generally no, you should not. You can choose instead from plenty of non-US domiciled equivalent and replacement ETFs.

See: Nonresident alien taxation, Nonresident alien investors and Ireland domiciled ETFs, Nonresident alien's ETF domicile decision table, and Index funds and ETFs outside of the US.

Q. Why does a fund or ETF's domicile matter?

A. The US taxes nonresident alien investors who hold US domiciled funds or ETFs. These taxes may make holding US domiciled ETFs unattractive, relative to non-US domiciled ones.

See: Domicile, and Nonresident alien taxation.

Q. My currency is not USD or EUR. What about the added currency risks with USD or EUR funds or ETFs?

A. An ETF's denomination and trading currencies do not affect your long-term investing returns.

See: Non-US investors and ETF currencies.

Q. Should I use accumulating ETFs?

A. Investors in some countries can obtain a tax advantage from accumulating ETFs. Otherwise, there may still be a saving of some trading costs.

See: Comparison of accumulating ETFs and distributing ETFs.

Q. What are the US tax risks of holding US stocks or US domiciled ETFs?

A. The US taxes non-US investors who hold US domiciled funds or ETFs. It applies both a high dividend tax rate (default 30%) and a high estate tax with a low exemption (default 26-40% of everything above $60,000). Treaties can lower these tax liabilities. Using non-US domiciled funds or ETFs escapes both of these issues.

See: Non-US investor's guide to navigating US tax traps, and Nonresident alien taxation.

Q. How do I choose an asset allocation?

A. This is a personal decision, based on your need, ability, and willingness to accept risk. It is part science, but also part art.

See: Building a non-US Boglehead portfolio, Stock asset allocation for non-US investors, and Bond basics for non-US investors.

Q. What is a good simple non-US portfolio?

A. You can construct excellent simple non-US portfolios using Ireland domiciled and other non-US domiciled ETFs.

See: Simple non-US portfolios, and Complex non-US portfolios.

Q. What is an investment trust?

A. Investment trusts are collective investment vehicles, similar to funds and ETFs but with a different legal structure. They are closed-ended. Rare in the US, but more common outside.

See: Investment trusts.

Q. What about real estate investment trusts (REITs)?

A. REITs provide a way for investors to add real estate as a portfolio asset class, but without the risks of direct property investment.

See: Real estate investment trusts for non-US investors.

Q. Should I consider using a robo-advisor?

A. Another personal decision. A 'robo-advisor' can be a useful alternative to managing investments yourself.

See: Non-US robo-advisors.

Q. Is there an online tool that helps with all of this?

A. Yes!

See: Boglebot.

Q. Where can I ask for help?

A. You can ask on the Non-US Investing forum. Before posting, take a look at the guidelines for what to include in your post. This will help forum members to provide accurate answers.

See: Non-US Investing Forum, and My portfolio: seeking advice.

Q. Is it possible that I am a US person?

A. You might be, and not know it. A US person is anyone who is a US citizen or US permanent resident (green card holder). Someone born in the US is automatically a US citizen. Someone born outside the US to a US citizen parent may automatically be a US citizen.

See: w:Accidental American, and Domicile.

For non-US investors in specific countries

Q. I live in a European Union country. Is there anything special I should know?

A. See: EU investing, EU non-habitual residence, and Cash equivalents for EU investors.

Q. Is there anything here specific to my home country?

A. There are pages specially for investors in some countries. (If you don't see yours, maybe consider contributing one!)

See: Belgium, Germany, Ireland, Italy, Netherlands, Spain, Australia, Brazil, India, Japan, Singapore, and United Kingdom. Also, UK ISAs and UK pensions.

Q. Is there anything here that is specific to Canada?

A. We have a sister wiki and forum, devoted entirely to investors in Canada.

See: finiki, the Canadian financial Wiki and Financial Wisdom Forum.

For US persons living outside the US

Q. What is a US person? Am I one?

A. You are a US person if you are a US citizen or US permanent resident (green card holder).

See: w:Accidental American, Domicile, and Non-US investor's guide to navigating US tax traps.

Q. What is an accidental American?

A. Someone who is a US citizen, but who lives outside the US, and either left at an early age or has never lived there. They may even be unaware of their US citizenship.

See: w:Accidental American.

Q. How do I handle my US taxes?

A. US taxes for a US person living abroad can be a lot more complex than for a US resident.

See: Taxation as a US person living abroad.

Q. Why does my US person status cause investing problems?

A. The US taxes on both residency and citizenship. FATCA requires non-US banks to track the activity of US persons and report it to the US. Some non-US banks avoid this by refusing service to US citizens.

See: Passive foreign investment company, and w:Foreign Account Tax Compliance Act.

Q. Is there anything here specific to my residence country?

A. There are two pages specially for US persons living in specific countries.

See: Investing from Japan for US citizens and US permanent residents, and Vanguard US domiciled ETFs that are UK HMRC reporting funds.

Q. What are my investing obstacles and options?

A. Unless your home country has no income tax, you live under two overlapping but conflicting tax regimes. It may be hard to find investments that do not cause problems with one or the other of them.

See: US tax pitfalls for a US person living abroad.

For people moving in to or out of the US

Q. What should I consider before moving in to the US?

A. You need to undertake a complete review of all of your finances and investment holdings before moving to the US. This will help you to avoid US tax traps once you become a US person.

See: US tax pitfalls for a non-US person moving to the US.

Q. What should I consider before moving out of the US?

A. If you want to sever all tax connections with the US when you leave, take care to follow all the correct procedures. Or, if you plan to live outside the US as a US citizen or US permanent resident (green card holder), pay close attention to the investing issues and obstacles you may face once no longer a US resident.

See: US tax pitfalls for a non-US person moving to the US, and US tax pitfalls for a US person living abroad.

Q. Can I leave the US but keep my green card?

A. Your green card becomes technically invalid for reentry into the US if you are absent for one year or more. You can apply for a reentry permit to extend this to two years. You remain a US person for tax as long as you hold permanent resident status.

See: US tax pitfalls for a non-US person moving to the US.

Q. What happens if I leave the US and just let a green card expire?

A. Unless you affirmatively surrender your green card, you remain a US person for tax, and the US will continue to tax your worldwide income, even though the card is no longer valid for US immigration.

See: US tax pitfalls for a non-US person moving to the US, and Non-US investor's guide to navigating US tax traps.

Q. What is the US expatriation tax?

A. This is a tax for renouncing US citizenship or surrendering a US green card. It applies if you meet certain asset or income tax limits. It covers both US citizens and long-term green card holders.

See: US tax pitfalls for a US person living abroad, and w:Expatriation tax.

Q. What are the special rules for J, F, M and Q visa holders?

A. These visas allow you to spend time in the US but without becoming a US person. Instead, for most purposes you remain a nonresident alien. However, if you remain over 183 days, the US will tax any US-source capital gains at a flat 30%.

See: US tax pitfalls for a non-US person moving to the US.

See also