Expat Index Investors Should Duck U.S. Estate Taxes

Non-American expats with U.S. listed stocks or ETFs might consider making a switch.

U.S. estate tax laws suggest if an expat owns more than $60,000 in U.S. listed stocks or funds, and gets hit by a bus or eaten by a crocodile, their heirs will feel the bite.  

By investing on a different exchange, however, they wouldn’t give the U.S. government a chunk of  their posthumous pie.  



Expat Canadians can use Canada’s stock market instead, via three popular international brokerages:  DBS Vickers, Saxo Bank, TD International.  

Vanguard Canada recently introduced some fabulous exchange traded funds. 

These wouldn’t attract U.S. estate taxes because they trade on the Toronto exchange.



Ticker Symbol

Expense Ratio

Vanguard Total Canadian Stock Market ETF



Vanguard Total U.S. Stock Market ETF



Vanguard Developed World Stock Market ETF



Vanguard Canadian Short Term Government Bond ETF




Expatriate Canadians don’t have to pay capital gains taxes on their stock market investments if they’re held in a friendly tax jurisdiction, such as Hong Kong, Singapore or Luxembourg–and if the investor resides in a jurisdiction that would allow such an account. Canadian non-residents may also be able to open “non resident” brokerage accounts with Toronto-based TD Waterhouse, which wouldn’t incur capital gains taxes either. But investors would need to make a trip to Canada to open such an account.  Canadian accountant Ernie Nagarath suggests it would not jeopardize non residency status.  Trading commissions would also be cheaper, with no additional account charges.

Dividend withholding taxes of 15% would be taken at source.

Those wishing to cut tax further may consider replacing Vanguard’s Canadian and U.S. stock market ETFs with swap-based products from Horizon. HXT tracks the 60 largest stocks in Canada, costing just 0.07%.  HXS tracks the S&P 500, costing 0.15%.

Swap-based ETFs, such as these, don’t incur dividend taxes.  Held by a Canadian expatriate, they would be completely tax-free.  But ensure that you understand the added counter-party risk.

Writer and investment advisor Dan Bortolotti does a good job explaining how they work.  



Australian expats can access their home country stock market through TD International or Saxo Bank. 

Vanguard offers a list of ETFs for Aussies, some of which appear below.



Ticker Symbol

Expense Ratio

Vanguard Australian Government Bond Index



Australian Shares Index



U.S. Total Stock Index



All World (ex U.S.) Stock Index




According to Saxo Bank Singapore’s Senior Manager, Eoh You Loong, the dividend withholding tax rate on Australian ETFs is 30% for expats. 

There are no capital gains taxes if the account is located in Luxembourg, Singapore or Hong Kong.

If, for example, your investments earn 10% in a given year, with 8% coming from capital gains (price appreciation) and 2% coming from dividends, you would pay 30% tax (taken at source) on the 2% dividend.

As such, your net dividend gain would be 1.4%, providing a total net gain of 9.4%, after a pre-tax gain of 10%.


British Investors

Expatriate British investors can trade on the UK markets to bypass U.S. estate taxes. I’ve listed some portfolio builders below.  TD International and Saxo Bank both offer British stock market accounts.



Ticker Symbol

Expense Ratio

Vanguard All World Stock ETF



Vanguard UK FTSE 100 Stock Index



Vanguard UK Government Bond Index




These ETFs are domiciled in Ireland, carrying a 20% dividend withholding tax.  But British expats wouldn’t have to pay capital gains taxes.


Why Vanguard?

Vanguard isn’t the only exchange traded fund provider; iShares is larger, and offers more products. But Vanguard is cheaper, because it’s a non-profit firm. Fund charges cover business costs…and that’s it.

Vanguard doesn’t trade as a public company.  Unlike firms like Fidelity, Franklin Templeton or JP Morgan, no shareholder shimmers in profits.  Salaries paid are modest.


How Do I Open A Brokerage Account?

As of 2014, TD International and Saxo Bank brokerages could be opened online. In some cases, you may require a notary to sign a form verifying your identity. 

But there’s no need to hop on a plane to open an account if you’re living outside of Luxembourg (where TD International is based) or if you’re living outside of Singapore or Hong Kong (two capital gains free jurisdictions with Saxo Bank brokerages). 

TD International, however, doesn’t invite everyone to the party.  If you’re an expat living in Japan or Bangladesh, for example, you can’t join the club

 Saxo Bank doesn’t seem to like Japanese based expats either.

Japanese based expats, however, can open brokerage accounts with Singapore’s DBS Vickers.  But they will need to travel to Singapore to do so.  Madeline Chen, of the DBS Vickers Client Services Contact Center says, “Japanese-based expats can open accounts as long as they meet the management subject of approval.”  When I pressed her on what that meant, she queried her supervisor who stated, “They must first open a local POSB or DBS bank account.  They must be above the age of 21; they can’t be currently bankrupt; they can’t be a delinquent.  Nor can they be an ex-delinquent.”  So if you wrapped your high school chemistry teacher’s Volvo with toilet paper, don’t tell DBS Vickers.

 Incidentally, DBS Vickers doesn’t discriminate against anyone, except Americans.

What If Selling Your U.S. domiciled ETFs Will Cost A Small Fortune?

Trading U.S. market ETFs for those on another market could accompany steep commission costs.  For example, trading $1 million of U.S. ETFs in exchange for Canadian ETFs would cost $8,500 in commissions through DBS Vickers.  It costs 0.35% to sell U.S. securities, and 0.5% to buy Canadian ones.

Here’s a strategy that would reduce commission costs.  You could ask DBS Vickers to transfer your U.S. shares to a Saxo Bank brokerage using a Security Outward Transfer Form. Transferring four U.S. domiciled ETFs costs $200 ($50 each).  The same old U.S. indexes would arrive in your new account.  So you would still need to sell them, before using the proceeds to buy ETFs off the Canadian exchange.

Saxo Bank’s trading commissions are far softer than those at DBS Vickers.  They charge 2 cents per share for U.S trades and 3 cents per share for Canadian shares.

I’ll use a large account to dramatize the point. If you had 12,000 shares of Vanguard’s U.S. stock market ETF, and it traded at $92 per share, you would have roughly $1.1 million in U.S. shares. Once transferred from DBS Vickers to Saxo Bank, you could sell the shares.  It would cost $240 to do so. 

In total, even if your account were worth a million dollars, your transfer costs, commission sales and new purchase orders would save nearly $8000, as opposed to keeping the money with DBS Vickers, and making the switch from U.S. to Canadian listed ETFs.

Saxo Bank charges lower trading commissions than DBS Vickers.  But they charge a higher exchange rate fee: 0.5%.  Trading U.S. market ETFs for Canadian, British or Australian equivalents will incur an exchange rate charge.  Saxo Bank will waive this fee (as a one-time privilege) if you’re transferring your account to them. 

They won’t do it automatically.  As I found from first hand experience, you will need to ask. 


Are There Other Sneaky Costs?

Banks and brokerages are in the moneymaking business—for themselves.  TD International charges reasonable commission rates, but they tack an extra 0.2% cost per year on the account’s total proceeds.  DBS Vickers doesn’t do so, but Saxo Bank is preparing to initiate a similar fee. Over the long term, extra annual costs of 0.2% are far more detrimental than even the highest brokerage commission rates. 

Such fees (0.2% per year) are laughably low, compared to the gouging exhibited by firms like Friends Provident, Generali and Zurich International

But they’re still a hole in the wallet.

Saxo Bank’s Eoh You Loong says the fees can be waived for premium clients, likely those with $500,000 or more in assets.  Clients that trade frequently may also be exempted, as determined on a “case by case basis”.  Strike a deal if you can. 

After all, it’s your money.  Don’t make a brokerage richer. And let the U.S. government pay its own freaking debts.


The above information was accurate, as of January 9, 2014.  My book, with the working title, The Global Expatriate’s Guide To Investing, will be published November, 2014.


Andrew Hallam

I’m a financial columnist for Canada’s national paper, The Globe and Mail, as well as for AssetBuilder, a financial service firm based in Texas. I’m also the author of Millionaire Teacher: The Nine Rules of Wealth You Should Have Learned in School (2nd Ed. Wiley 2017) and The Global Expatriate’s Guide To Investing: From Millionaire Teacher to Millionaire Expat (Wiley 2015). My mission is to educate, motivate and inspire people on basic retirement planning and best practices for investing, using evidence-based strategies. I'm happy to comment on your questions. However, please read the Terms of Use, Privacy Policy and the Comments Policy.

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330 Responses

  1. Singhatrader says:

    Hi Andrew,
    I am struggling to find a solution for Singaporeans who buy Vanguard ETFS in US market through DBS. I have not comeup with any solution as yet. Do you have any ideas how Singaporeans can overcome the Estate Tax burden.

    • Singhatrader,

      You could invest in ETFs trading on the Canadian exchange, via DBS Vickers. I have listed some options for you in this piece.


      • Singhatrader says:

        Hi Andrew,

        Thanks for the cue. As I have ard 61K in VT I will leave it there. For the new purchases I will go the Canadian Vanguard ETFs. Will there be currency risk if I buy through Canadian ETF’s through DBS? Also I have read the prospectus of VGG and VGH where VGH is CAD hedged. can you kindly explain how does VGH differ from VGG ( in other words how does the hedging work)


  2. Andy says:

    Hi Andrew;

    Have you been in touch with any Irish people and has anybody asked your advise about investing in the Vanguard Index Funds? I notice the recent Vanguard Index funds domiciled here in Ireland; are those suitable for Irish residents?
    Lastly will you include a guide for Irish residents on how to cheaply start buying into Index funds with Vanguard or iShares who seems to be very similar as well?

    Thanks, Andy, Dublin.

    • Hi Andy,

      I’m no expert on brokerages based in Ireland. But give a few of them a call. Ask if you can open a trading account with them, but one where you receive no advice. There will be plenty of brokerages that want to hold your hand and charge plenty for it. But if you want to do it yourself, you could find a low cost brokerage just charging trading commissions only. From that platform, you should be able to buy Vanguard ETFs domiciled in Ireland.

      Please let me know what you find.


  3. Scott Rousseu says:

    Hi Andrew,

    Love your articles and your first book. I’ve been following your blog for a while now and recommending it and your book to readers of my expat website. I notice that you often mention that expatriate Canadians who invest in a tax friendly jurisdiction don’t have to pay capital gains taxes. I know you and your readers often discuss this point as well. I have been a Canadian non-resident for over 15 years, have cut all residential ties, etc., but I have a TD Waterhouse account as well as a bank account for my rental properties. TD Waterhouse and any bank in Canada can set up a non-resident account and deduct withholding taxes on dividends accordingly. In this way, everything is above the board for Revenue Canada and you only have to pay $10 to trade with no silly fees on your holdings like with TD international, etc.

    I know you feel that there is some risk that CRA will deem you a resident if you do something like this, but it would be very, very difficult for CRA to prove someone like me is a resident when I have no ties, only go back every 2 years, and have accounts stating I am non-resident. I know many others who do the same.

    • Thanks for sharing your experience Scott. This method appears to be very legitimate, based on a conversation I had with a Canadian non resident specialist accountant.

    • Adam says:

      Hi Scott and Andrew,

      I appreciate you posting this, Scott, and Andrew, I visit your site regularly and enjoy reading your articles, too. I’ve read your book three times and recommend it to everyone.

      I opened my non-resident TD Waterhouse account on a visit to Canada two years ago and have since regularly invested in ETFs with no problems. Several of my Canadian colleagues here in China do as well. We don’t pay any capital gains but do pay a withholding tax on dividends and distributions. Investing through a non-resident TD Waterhouse account might be a more convenient and cheaper option for non-resident Canadians thinking about investing. One only needs to stop by a TD/Canada Trust branch while on a visit and speak with an agent.

      My understanding is that Canada wants foreign investors, even if those are non-resident Canadians. Equity investments in Canada aren’t seen as a tie that contributes to doubts over non-residency status. Non-residency status is further protected if the country one is residing in has a tax-treaty with Canada. Part of this tax treaty has a “centre of vital interests test” that supersedes the generic primary and secondary ties and allows more flexibility for someone residing in a foreign country and owning assets in Canada. Tax treaty or not though, unregistered equity investments in Canada wouldn’t be enough to make you a resident or tilt you in that direction.

      I found a couple of Youtube episodes from a Canadian accountant, Mr. Ernie Nagarath, that helped in my understanding. Check around the five-minute mark in the link below.


      All the best,

      • Thanks for this Adam. A friend of mine (Canadian resident of Singapore) spent Christmas in Canada this year and opened such an account with TD Waterhouse. I’ll be mentioning this as an option in my upcoming book on investing for expats. Thanks again for the link.


      • Ian says:

        Hi Scott, Adam and Andrew,

        Wait a minute…are you saying TD Waterhouse would be a better option rather than TD International? I am a Canadian expat in the UAE in the middle of opening up a TD International account in Luxembourg. I went to Canada a few months ago and opened up a TD Waterhouse account thinking that while I was there I might as well open one up rather than try and do so from abroad. I haven’t put any money into it yet because when I went back to the UAE, (and I confirmed this) I found TD Waterhouse had me registered as a Canadian resident which I am not (I think I meet the non-res. terms). I asked TD Waterhouse if they could change my status to non res.in their database and then allow me to make purchases but they said they could not allow me to do that. Would you suggest I ask again and if they agree, that TD Waterhouse would be an easier/cheaper option than TD International?
        Thanks for your input. Love the insightful comments and articles.

        • Hi Ian, it would be a cheaper option. But you may need to change your residency status with the bank in person, or show documented proof of your current residency so they can change your status. It’s a shame you didn’t provide an address in the UAE when opening the account.

          Good luck. I hope you’re able to do it.


  4. Dianne says:

    Hi Andrew,

    Thanks for the timely post – at least for me, as I’m just about to get started and wanted to know if I should buy Vanguard from US or Canada. DBS Vickers tells me that if I leave Singapore I would not be able to maintain my DBS Vickers account. In that case, would it be better to just start off with a TD International account so I would never have to worry about switching brokerages? I’ve already done all the work to open a DBS Vickers account, and I plan to stay in Singapore for the foreseeable future but …. one never knows! Is there any advantage to DBS Vickers over TD International in your opinion?

    Many thanks,

    • Hi Dianne,

      The DBS Vickers rep you spoke to likely gave you false information. Not only would you be able to keep your account, but foreign expats are able to set up such an account, after visiting Singapore to do so. Either they made a new policy change this week, or (as is often the case) you got someone on the phone who doesn’t know the score. Of course, if you repatriated to Canada, you couldn’t maintain this account, but if you move to Timbuktu, you should be able to. Call them one more time, OK? Ask the same question, and if you get the same response, please let me know.


    • Dianne, I just called DBS Vickers on your behalf. You can keep your account if you live overseas. And non residents of Singapore can open accounts. I just updated this part in my book, with a quote and name from this afternoon. I was asking specifically about the trickiest location of all: Japan. Don’t ask me why, but most brokerages don’t want Japanese based expats.

      From the book:

      Japanese based expats can open brokerage accounts with Singapore’s DBS Vickers. But they will need to travel to Singapore to do so. Madeline Chen, of the DBS Vickers Client Services Contact Center says, “Japanese-based expats can open accounts as long as they meet the management subject of approval.” When I pressed her on what that meant, she queried her supervisor who stated, “They must open a local POSB or DBS bank account first. They must be above the age of 21; they can’t be currently bankrupt; they can’t be a delinquent. Nor can they be an ex-delinquent.” So if you wrapped your high school chemistry teacher’s Volvo with toilet paper, better not tell the good folks at DBS Vickers.

      • Dianne says:

        Thanks so much, Andrew! I’ll take your good advice yet again, and keep my sordid past under wraps! 🙂


    • Jerry says:

      TD International will require that you close your account if and when you become resident of Canada or the USA. They are legally prohibited from dealing with you in that case. You can verify that with a quick call to their toll-free number.

      I am gratified that the solution-of-choice seems to be the one I chose: An RBCDS account in Toronto, defined as non-resident with all appropriate taxes with-held and documented. I am a Canadian expat and have been for the last 25 years.

  5. RJB says:

    Thank you Andrew for such an informative post. It’s something I’ve been looking into recently.

    Now if we could only persuade brokerage firms to be consistent with the information they give out to potential clients regarding their services, they might actually get some business.
    I’m referring in particular to your reference to the senior partner at Saxo Bank in Singapore claiming that no restrictions are in place for residents of Japan. That is interesting because it is contrary to what I was told by one of their managers a few weeks ago, who insisted (after checking with their compliance department) that residents of Japan were unable to open accounts with their Singapore office.
    It’s very confusing.

    • Tricky stuff. I wonder why there’s such a hangup on Japanese based expats. I just called Saxo on your behalf, and this time they gave me an answer consistent with what you have found. They said you could open with Saxo Japan, but then said that only FOREX trading would be allowed. So that’s pretty useless. You Loong told me that if you gave him an alternative address, something with your name and billing address suggesting a different country, you could open an account. His direct number is 65 6303 7732. You might have to be creative. Sorry about it being such a pain in the butt. Please keep me posted.

      • RJB says:

        Hi Andrew,

        Thank you so much for your help. It’s much appreciated as I know how busy you are.

        I’m not sure why but it seems to be only the international brokerages that have problems with Japanese residents.
        I intend to travel to Singapore to open an account with DBS Vickers but I was just exploring all my options.

        Thanks again for your reply. I’m eagerly looking forward to your new book.

        • pwagenaar says:

          Hi RJB,

          I am a expat working in Japan as well and ran into the same problems with TD and Saxo. I will be traveling to Singapore in March to open an account with DBS Vickers. Perhaps we can share information on the process. My email is my screen name above at hotmail.com.

      • Japanese National Tax Agency says:

        Andrew, and ex-pats based in Japan,

        Japan’s NTA was forcing off-shore brokerages and banks such as Saxo, DBS Vickers, and TD International to maintain offices in Japan. It seems that since this is a major expense for brokerages to incur and the ex-pat or local client base not enough to warrant such huge costs of having offices here, that they closed off services to potential clients in Japan.

        But also more importantly DBS Vickers, Saxo, and TD Luxembourg would be forced to hand over all customer details and information to the Japanese National Tax Agency after opening their branch offices here. Something none of them want to do

        It should be noted that countries like Canada and American cooperate fully with the Japanese NTA forcing banks to disclose all of the details on their clients. TD International, for example, refused to do this. As you all probably know, Japan is heavily in debt and, as a result, has become very aggressive about collecting when it can. There have been a number of long term ex-pats who have reported being audited by the Japan NTA and who have expressed disbelief at the long arm of the Japan NTA! They were shocked to find out how much the NTA knew about their investments, properties, cash savings back home, especially Canadians.

        There’s some discussion of this on the gaijinpot.com forums, which I think has since been closed. Several long term expats have described their experiences dealing with the Japan NTA and their intrusive behavior.

  6. KF says:

    Dear Andrew,

    Recently you have been talking about switching to buying from Canadian stock exchange to avoid estate tax and enjoy lower dividend withholding tax. From the Vanguard Canada website, I can’t seem to find anything that is comparable to VEA. I wonder if you have any recommendations for this?

  7. Kyith says:

    if you are using a standard chartered online trading account which is a nominee account, will you be hit with estate duty?

    • Hi Kyith,

      If you use Standard Chartered, and buy U.S. stocks or ETFs trading on the U.S. market, then yes, your heirs would have to pay U.S. estate tax if you died. I should say, “when” you die because you won’t be creeping around in 200 years. But that would be a bit morbid. However, SC provides access to (I believe) the British stock market as well. In that case, you could purchase the ETFs (for Brits) which I mentioned in this article (even a S&P 500 ETF) and there would be no U.S.estate tax to pay upon death.

      • Kyith says:

        hi Andrew, yes i think you are refering to VWRL. it seems u mentioned that the vanguard etf over there are domicile in ireland so the dividend has a 20% withholding tax isnt it.

        nevertheless i hope the currency conversion is worth it. SCB have some pretty problematic conversion but they dont have dividend handling fee and all

  8. KF says:

    Hi Kyith,

    If you are referring to dividend witholding tax, I believe they still apply at 23% for US ETFs. I have been using the SCB trading account for the past year.

    • 30% Kyith, for U.S. domiciled stock and ETF dividends; 15% for those domiciled in Canada.

      • Kyith says:

        hi KF and Andrew,

        apologies if i confuse you guys, but i am refering to the dividend withholding tax on UK vanguard etf such as VWRL

      • Goodfellow says:

        the US withholding tax can be greatly reduced, I think down to 10% of income if you reside in a country that has a tax treaty with the US..most countries do.

      • Michael Martin says:

        Yes but 15% only if the country has an tax treaty with the US (approximately 60 countries have one) and by filling W8BEN form. Unless I am mistaken some brokers (like IB) now do it automatically for you when suscribing

        • Michael,

          I’m glad you wrote this extra comment. You are talking about dividend withholding tax. I was talking about U.S. estate tax upon death. The U.S. estate tax, upon death, is about 40%.


  9. KF says:

    Hi Kyith, sorry too if I confused you. Andrew is right, there is 30% of dividend witholding tax for U.S ETFs. Sorry~ my calculations were wrong.

  10. Jeffro says:

    Hi Andrew,

    This is superb information. Thanks.

    With regards to ‘other sneaky costs’ Saxo recently slapped a new, juicy fee onto client accounts. Looks like you need to rebalance TWICE a year to avoid it.
    From their site:
    ‘ . . . For the purpose of ensuring a cost structure that reflects the client’s actual usage of the trading platforms, [Wha? Who writes this stuff?] Saxo Capital Markets will be implementing a new fee structure . . . From 1st March 2014, an Inactivity Fee of USD100.00 will be imposed on accounts without trading activity (in any instrument) for 180 days. . . . ‘

  11. Kyith says:

    hi andrew i will like to bring your attention to 2 different ETF listed in UK domiciled in ireland



    SWDA is a REINVESTING ETF. Expense ratio .40% I wonder if this is good enough since over there no estate duty.

  12. Kf says:

    Hi Andrew,

    Do you happen to know how the exchange rates work at Saxo bank? Say, i am trying to buy units of VUN on the Toronto Stock Exchange, and i would like to fund the purchase with Singapore dollars. Would you be able to point to me how it works out?

  13. James says:

    Hi Andrew,

    I will be moving to Singapore in February. I’ve been in various locations around Europe for the past few years & despite posting on here a couple of years back, I still haven’t gotten around to investing with a mix of index & bonds. Inflation and low interest rates are beating me!

    I’ve vowed to visit Saxo Bank and DBS Vickers in Singapore next month and with that in mind I would be very interested in the answer ti Kf’s question above regarding exchange rates. Although I’m Irish, I’d like to invest in UK indices (e.g. FTSE All Share or FTSE 100) & UK bonds/gilts. From what I’ve read in your article & the comments below, I believe I can invest in these items with Saxo Bank/DBS Vickers. Can I do so using SGD$ or must I exchange to £GBP? If I have accessible savings in the UK in £GBP, could I invest with Saxo Bank/DBS Vickers in Singapore using this money?

    I’m looking forward to the new book. Best of luck with it. Send some advice towards the Irish expats… Emigration is a national past-time for us so we could do with your help!



    • Andy says:

      Glad to see another Irish man posting here; this is a great financial advice website!!
      I would also like to say Andrew, that if you could send some advice towards the Irish expats also – give us a mention in your forthcoming new book. Ireland has been badly affected by emigration – and even for people trying to make a go of it here in Ireland – good pension planning advice is badly needed.

  14. KF says:

    Hi Andrew,

    Would you be able to advise on my question above? I have another question though. Regarding the avoidance of US estate tax, I have read that opening a joint account will solve the problem. What do you think of this approach?

  15. KF says:

    Sorry Andrew, I think the link did not work properly. My question in the pervious post was:

    Do you happen to know how the exchange rates work in Saxo bank? Say if I were to buy Canadian ETF from Toronto Stock exchange, using Singapore dollars.

    Also, what are your views on avoiding US Estate Tax by opening a joint account?

    • Hi KF,

      Saxo charges a low commission on the purchase (by international standards) but a high commission on currency exchange. To exchange SGD to CDN, you would pay the spot rate, plus 0.5% on each purchase. As a result, it’s similar to what you would pay with DBS Vickers. You can reduce the cost by taking SGD dollars, and converting them yourself into CDN at a bank, then transferring the CDN to Saxo. You won’t pay spot rate, plus 0.5% on the spread, thus saving money.

      I can’t see an upside to trying to dodge U.S. estate taxes by opening a joint account versus ensuring your ETFs are domiciled in a country other than the U.S. Consider the margin of advantage and safety.

  16. Sean McHugh says:

    Hi Andrew,

    As a Brit who has been following your advice closely, I now have a load of US listed stock, particularly VT and ISHG, along with many of my colleagues, which has done well, TYVM (a lot better than it would have with Zurich et al). Before I lead them down this path I need to make sure I’m giving them the right advice…

    Here’s my understanding of the implications of this for Brits, sell off the US listed ETFs we own, eg VT, VEA, ISHG, and then use the proceeds to purchase either again, but using a UK broker like TD Direct instead, in which case the equivalents are:

    EWU – VUKE (I like HUKX.L – you recommended this somewhere else)

    BUT, the selling the stock is the tricky bit. I (obviously naively) thought it would just be a question of doing what I did to buy, but in reverse, ie, pay $30 USD ish, and the funds become liquid. But, it seems from reading this post that this is not the case … so, I need to create an account with Saxo Bank, then ask DBS Vickers to transfer my US shares to my newly created Saxo Bank brokerage account using a Security Outward Transfer Form. Then I sell them, before using the proceeds to buy ETFs off the UK exchange, via TD Direct – which I’m guessing means transferring the funds back into my local Singaporean bank account, then … transfer those into a TD Direct account, converting to Sterling (more cost?) and purchasing the relevant ETFs.

    Does that sound about right?

    • Hi Sean,

      That is correct…and it’s the cheapest way to make the switch possible.


      • Sean says:

        Thank Andrew.

        Great. Although I guess once we go to the trouble of creating a Saxo Bank brokerage account, we might as well just use that to buy the UK based ETFs, no need to complicate things by using TD Direct?

        And, possibly a couple stupid questions:

        Is the $60,000 number of pain, related to the total value of each listed stock, or the combined total? Like if I have $60,000 in VT, and $60,000 in ISHG, would that avoid the taxation problem?

        Once we hit the $60,000 is it all taxed from zero, or ‘just’ the value over and above $60,000? Sorry I’ve tried to work this out from the source site you listed, but I can’t see this mentioned (or any mention of a %).

        I think this is going to be an important topic when you return to us later this year …

        • The 60K is total Sean. Bummer…I know. But it’s nice that there’s a simple alternative. If you switch to Saxo, don’t let them charge you the spot rate plus 0.5% on the initial lump conversion to UK pounds to make the first ETF buys. If you ask for them not to (as I found) they won’t. But it’s a one time only deal, as they described it to me. And you will have to ask for it!


          • Sean says:

            Shame, I’ve just been in contact with Saxo and they are telling me they are ‘unable’ to waive the feee, I quote:

            “I checked with my management and the currency conversion at spot rate with mark up of 0.5% (on the spot rate) will still apply to you if you decide to convert your funds from one currency to another.

            This currency conversion is done automatically by the system and hence we are unable to waive this off for you.”

            Hmm. ‘Unable’?

            That makes it expensive, 0.3% to sell the US stock, 0.5% to convert the currency, 0.1% to purchase UK stock.

            I’m wondering about the strategy outlined by another poster here, sticking with DBSV and purchasing ETFs that track US stock, but that are not held in the US…

            Sticking with DBSV also allows us to take advantage of the Singapore SRS tax deferral scheme … (Saxo Bank are excluded from that)


            As a colleague of mine explains:

            “You deposit $30,000 into the scheme.
            You get the tax back – so your tax bill will be $4500 lower per year – nearly $400 a month off your tax bill.
            You can invest [with authorised brokers] that $30000 – and you get a $30,000 allowance every year.”

          • Don’t give up on them waiving the fee. They offered it to me when I went down in person. If all you tried was a telephone conversation, perhaps try a different card. You could get down there, set up an appointment, start filling out paperwork, then ask questions about transferring a lump sum over. Put the brakes on everything if they won’t give you a one time break. They need your money Sean. Don’t give up so easily. I didn’t.

          • You don’t pay capital gains tax anyway Sean, so what kind of tax deferral could it possibly be?

          • Sean says:

            We don’t pay capital gains Andrew, but we do pay income tax. Via the SRS account, the IRAS allows us not to pay tax on whatever we pay into our SRS accounts, until we withdraw it all 10 years later. Then they tax 50% of it instead of all of it.

            They idea is to tax us less, to encourage us to invest more. The catch is that we can only invest the funds in the SRS via local banks (eg DBSV, not Saxo) and even then only stocks listed on the SGX.

          • But we pay so little in income tax. Why concentrate our holdings on the local exchange, at the expense of diversification, just to save a bit of money on income tax? I can’t see the benefit.

          • Josh says:

            Sean, you can only invest in Singapore securities with the SRS.

          • Sean says:

            I’ve just been in contact with Saxo again, same guy I think you spoke to Andrew, Eoh You Loong, he says the only reason they would waive the 0.5% is if the lump conversion is greater than $500,000 USD.

            Which probably means *you* qualify, but others won’t especially if they have been investing long… Even if you have $500,000 or more, you still have to ask for the waiver.

            I’m becoming a big fan of the ‘make sure your wife/partner knows how to sell your stocks if you die’ method … leave my US stocks there, (they will be the priority to sell if/when I need the cash) but new purchases will be UK stock with Saxo.

  17. Justin says:

    Hi Andrew and other fellow disciples,

    Expat CDN teacher here residing in China.
    I flew to Singapore recently and have my DBS Vickers account set up now and was just about to purchase my portfolio when I noticed this new thread which suggests buying from 4 ETFs from the CDN market instead of the 4 previously listed (I realise 2 are the same as the ones previously recommended). I will follow Andrew’s new advice as I obviously have no interest in the US gov getting any of my savings.

    Three random questions from a layman:
    1. Does this mean that all my purchases will be in CDN dollars? I preferred having some of my money in USD as it is a more international currency. I anticipate possibly having to exchange currency more if my money is in CDN$.
    2. Currently my money is in RMB in China. When I send a telegraphic transfer to DBS when purchasing ETFs, is it better to send DBS money in RMB and they exchange it into CDN or is it better to have the Bank of China exchange it into CDN$ first? I am looking for the best exchange rate scenario.
    3. I noticed that DBS Vickers has China listed as a potential place to buy stock. With China on the rise and my money currently in RMB, it seem like having say 10% of my couch potato portfolio in such an emerging market might be a good idea.
    Any and all insights and thoughts appreciated,

    • Justin,

      I can answer the first question:

      If I buy a U.S. index off the Toronto stock market, using Canadian dollars to do so, my money is exposed to the U.S. dollars, not the Canadian dollar. It’s priced in Canadian, but movements will reflect U.S. stocks and currency. If you do the same with an international index, you take on the currencies of the underlining holdings. In other words, it represents many currencies, so it’s internationally currency neutral.

  18. Tom says:

    Hi Andrew,

    Greatly enjoyed your book. Just starting out and have a couple of questions.

    Do you know if Vanguard do a UK/Ireland-based fund which is equivalent to ISHG in terms of holding short-term government bonds from multiple developed countries rather than just the UK (VGOV)? Does this matter much in terms of exposure?

    I’m planning to split an investment between Total UK Stock Index, Total World Stock Index and short-term gov bonds. Is there any additional benefit of adding Total US Stock Index to this split? Or is it an unnecessary complication? And again can this be done through a Vanguard UK/Ireland based fund? I noticed a Total US Stock Index wasn’t mentioned in the British investors section in the article above.


  19. Giles Harrison says:

    Hi Andrew,

    Just a point of interest to note following some reading I’ve done on US Estate Tax for non-resident aliens, which is very relevant as so many index investing books are written with the US investor in mind and make US equity funds seem the primary choice.

    Basically, the tax seems to only apply to stock issued by US corporations, not all stocks on US exchanges. This blog has more specifics: http://ingenuitycounsel.com/2013/01/us_estate_tax_issues_for_canadians/

    The writer mentions that shares of stock issued by a U.S. corporation are considered ‘situated in the US’ while property considered outside the U.S. includes ‘Shares of stock issued by a corporation, which is not a U.S. corporation (regardless of the location of the stock certificates)’

    Therefore if you are trading stocks via the NYSE you may not need to switch your trading account/exchange provided you can find equivalent ETFs for your home market on the NYSE. For example, there is an MSCI ETF for the UK listed on the NYSE.

    While this availability varies depending on your target markets, it is worth noting for those who are hesitant to switch.

    The flipside is, it seems US stock held via ANY exchange would be liable for estate tax. Great…!

    • Kyith says:

      hi Giles, so what does VT consitute in this case haha

      • Guillaume says:

        Hi, Giles,

        I was wondering the same thing and been wanting to ask Andrew

        Say you’re, like me, with Interactive Brokers, a US broker:

        If you buy a US index ETF listed on the LSE, with your US broker… does the broker domiciliation make your LSE US ETFs more Estate Taxable than if they were bought with TD in Luxembourg ?

        I don’t understand really what they take into account… ETF purpose, Broker domicile, ETF or share domicile ? help 🙂

        • If you want to go with Interactive Brokers to save a small amount on commissions, go for it. However, these is a very small chance your heirs may have to pay U.S. estate taxes if you do. That chance is tiny. But it exists because IB holds its stocks in the United States–even if you buy them through a different exchange, via IB. The brokerage is based in the U.S. Chances are, you would be fine. But for just a small amount saved in commissions, do you even want to take the slightest risk?

          • Guillaume says:

            Hi, Andrew,

            Thanks for your quick reply. I love IB for the variety that it offers and the quality of the interface. I do some active trading on part of my portfolio and the £6 commission changed the way I can trade… I can do many more things when buying and selling is so cheap…

            However I couldn’t stand the idea of my family having to battle the US taxman if I would die suddenly…

            When it comes to anything long term, like the brilliantly simple ETF strategy you recommend, which I intend to implement one the more long term part of my portfolio, it will go to TD…

            Plus it’s always good to have more than one broker. In case things change positively or negatively in their services, or in their country regulations.

            Thanks again for the super advice 🙂

            And I’m off to finding a tax consultant also… this is way too scary :-)))

  20. Kelly says:

    This is a great article!
    I am a dual citizenship holder (Canada/Australia) living in the UAE and have opened an account with DBS Vickers, but haven’t started trading yet (still in the process of doing the test). My immediate family lives in Australia, so if I was ever to leave here (which is not in the plans right now as I’m married here), Australia is porbably where I would go. But as written in the article, I don’t have direct access to the Australian stock market through DBS Vickers. Is it worth opening a TD or Saxo account instead? It seems they all have pros and cons and my understanding is not good enough to evaluate them!
    Any advice would be greatly appreciated 🙂

  21. Sean says:

    Does anyone know if there this windfall tax applies to stock that is NOT held in a US company?

    Like ISHG is a bunch of NON US governments, like Canada, Norway, Japan, etc. So doesn’t that mean they would be exempt from the tax, traded using USD, but the bonds are NOT US bonds, right?

    Same for EWU (UK FTSE ETF) and even the VT isn’t ALL US companies … ?

  22. Kyith says:

    Hi Andrew, i bring you some information. As we all know UK have vanguard funds but a problem with buying through standard chartered trading is that there is a 0.5% stamp duty on purchase. This is a rather high cost that SCB doesn’t want to remove.

    I researched and found this news >


    It would seem the Stamp Duty on ETF in UK will be abolished in April 2014. I wonder if they will change their stance

    • Excellent find Kyith. Thanks for sharing!


      • Kyith says:

        No prob Andrew. I am getting my SCB rep to ask about this. Perhaps still quite early.

        Btw i read that for UK there are inheritance tax, but seems to me its 325k pounds which is like 700k SGD. but it seems only affecting UK domiciled citizens. I hope some UK folks can help clarify if we are Singaporeans, Hong Kong folks buying ETF there, does this affect us?

        Thanks so much

      • Marc says:

        Whilst those articles are definitely good news, they are also pretty damning re ETFs in general.

        Andrew what are your thoughts when you read the concerns by people like Terry Smith? He seems to mainly have a gripe with Synthetic ETFs (which I have tried to avoid) but also mentions that replicated ETFs may not actually hold the number of shares required for the outstanding number of units as banks are allowed to short them)

        Its all a little over my head to be honest so was hoping you could explain this risk to a layman

        • Hi Marc,

          A synthetic ETF doesn’t actually own the underlying securities. Instead, they’re based on promises a financial institution provides, to give you the return of the underlying index. There are only two synthetic indexes above, and I provided a warning about them. Otherwise, ETFs that truly hold the underlying index components (such as those above) are fabulous.


  23. Rob says:

    Hi Kyith

    That is an interesting question. Uk domiciled will pay 40% inheritance tax on their worldwide assets above £325,000. Non uk domiciled will also pay 40% tax but only on their uk based assets above £325,000.
    A non domiciled can transfer assets on death to a surviving non domiciled spouse / civil partner and delay the tax payment until the death of the spouse. The spouse will also have a £325,000 exemption and my understanding is this is cumulative, so upon the passing of the spouse, the surviving estate will be taxed 40% on uk based assets above £650,000.
    The same applies to a uk domiciled person. They can pass to uk domiciled spouse and delay the tax payment until the spouses death, at which point the surviving estate pays 40% tax on worldwide assets above £650,000.

    But…. If someone is uk domiciled and their spouse is not uk domiciled then the tax is payable immediately which could result in the spouse having to sell assets (perhaps even their home to pay the inheritance tax). The only way this can be avoided is for the surviving non domiciled spouse to elect to be considered uk domicile at the time. This would delay the tax payable until the spouse passes but would result in uk inheritance tax applying to worldwide assets.

    So the last question is are you uk domiciled? If you are a uk expat and have been living abroad and not a uk tax resident for some time, you probably are still considered uk domicile. It is largely based on your fathers nationality and seems hard to shake off. And the uk inland revenue will not confirm your domicile status. This is a potential problem for many.

    This is my understanding but i’m not an expert. I would welcome other interpretations. I have attached a link to the EY worldwide guide to inheritance tax, plus an article from the telegraph.



    I’m not sure if any readers have made it this far, but i have a question. Are vwrl, vts and veu subject to us estate taxes. I believe they are. Can anyone help with this?

    Regards, Rob

    • Hi Rob,

      You mentioned some ticker symbols, but not the exchange on which they trade. If they don’t trade on an American exchange, they aren’t liable for U.S. estate taxes. I have no idea what those ETFs represent, but let’s pretend they represent the U.S. S&P 500 index, but trade on the Australian, Canadian or British exchange. No U.S. estate taxes would be liable.

      • Zhan Hui says:

        Hi Andrew,

        I have a question regarding the VTS ETF. It is domiciled in the US but is trading on the ASX. Is it subjected to U.S. estate taxes? It is part of the QuietGrowth roboadvisor portfolio component for the US Stocks exposure.

    • Kyith says:

      hi Rob, thanks for the explanation. really appreciate it. but it would seem then as canadians, singaporeans or hong kong folks who buy ETF there, we are considered UK domiciled? thats really strange. really not to our advantage.

    • Kyith says:

      it would seem the threshold keeps raising, but if you are rich, it should implicate you rather fast > http://www.hmrc.gov.uk/rates/iht-thresholds.htm

  24. Joe says:

    Hi Andrew

    I bought your book two weeks ago while transiting through Singapore Airport and it is outstanding! I am currently a British teacher living in Vietnam and looking to invest following your advice on this website and in your book. I have a couple of questions though that I hope you would be able to help me with:

    I have just contacted TD International in Luxembourg (as recommended above) and because I am living in Vietnam, they won’t accept me as a customer. That leaves me with either Saxo Bank or DBS Vickers in Singapore and therefore I was wondering if you could answer a few questions for me:

    1) Can you get Vanguard index funds with Saxo Bank or DBS Vickers? If not, what other low cost index funds would you recommend?

    2) Being British, is worth me investing my money in the Singapore stock exchange or should I just invest my money in the UK as it is my home country, even though I will be liable to pay capital gains tax?

    3) On the whole for a Brit abroad with some money to invest, what advice would you give?

    Thank you for your time – your book is excellent and I’m looking forward to the new one.


  25. Brendan says:

    Hi Andrew
    Do you or anyone else have any suggestions for a replacement for Power Shares, ticker is PRF?
    I have enjoyed owning these and have done ok out of them..


  26. Jordan Benedict says:

    Another tax-ducking question for you:

    I have a friend who is from the USA and his wife is a citizen of Mexico. They were told it was a good idea to invest in “Offshore” funds and put them in his wife’s name to avoid taxes.

    So they were wondering what the best way to avoid some of the taxes. Is investing in her name a good idea? Or does that even matter since they’d be retiring in the US and need to pay taxes on money coming in regardless? Or does it make a difference if they retire in Mexico? Would they then be able to avoid paying US taxes on money earned on US accounts?

    Thanks as always for the great articles and advice!

    • Hi Jordan,

      Legally, non Americans can invest in an offshore account such as Saxo bank.

      • Jordan Benedict says:

        I see with Saxo, you still pay commissions and fees (albeit seemingly low at 0.02/share). Is this worth it over the investing yourself through Vanguard directly? Is there tax benefits during investment and retirement that make offshore banking worth it?

        Thanks, thanks, and more thanks!

        • Jordan,

          If you qualify for Vanguard (if you are American) then you won’t qualify for Saxo. But if you qualify for Vanguard or Schwab, you will pay far less in fees than I will via Saxo. ETFs are purchased without commission.

  27. Vanguard Canada says:

    I hold through Vanguard Canada:

    VSB – Short-Term Canadian Bonds – 40%
    VDU – Developed Markets (excluding Canada / U.S.) – 30%
    VUN – U.S. Total Stock Markets – 30%

    Does anyone think that I am making a mistake by not holding also VCN – Total Canadian Stock Market?

    I worry that it will just get complicated to balance as the investments grow.


  28. Mark says:

    Hi Andrew,

    It’s Mark again. Thanks for making this blog post, I didn’t realize that there were estate tax laws for non-residents investing through the NYSE. We are both expat and my wife is American and I’m Canadian and this tax clause would kick in if I ever suddenly passed away. Apparently, one way you can get around this is to “gift” your inheritance away in the case where you had a terminal illiness and these tax laws wouldn’t apply (at least not to the same extent) but of course this doesn’t cover accidental death. Not a pleasant thing to think about but we want to look after our families.

    My issue is I am a little torn in whether to continue investing through NYSE (we hold VTI, BND, VEA and VNQ) and risk estate laws with an accidental death versus investing in the same sectors via the TSE. Our accounts are all in USD and this would mean paying additional fees for currency conversion and also having our entire portfolio based in CDN dollars. I feel that having an entire portfolio based in CDN dollars to be an added risk that I am not entirely comfortable in. I know currencies fluctuate but the CDN dollar could easily drop 25-50% over time. I know that the same principle applies of dollar cost averaging (currency cost averaging?) but it is an added risk considering we probably won’t retire in Canada. I would prefer to keep our porftolio based in USD.


    • Hi Mark,

      A diversified portfolio domiciled on the Toronto exchange would not be in Canadian dollars–unless you just owned a Canadian stock index and a Canadian bond index. Let me give you one example. Imagine buying a S&P 500 index fund off the Canadian exchange. It would be priced in CDN when you buy and sell it, but the CDN dollar has nothing to do with its inherent value. It would be invested indirectly in the U.S. market, thus the U.S. currency. A globally diversified portfolio is a globally diversified portfolio. It would have no emphasis on any one currency. Let me explain this a different way. A barrel of oil is priced in USD. So…if you bought a barrel of oil in Kuwait, are you taking a bet on the USD? Of course not. You are going to earn or lose based on the underlying value of the asset itself. Not to keep your money out of the U.S. makes little sense.


  29. Mark says:

    No but it is. I have bought VCE and XBB through the Toronto Stock Exchange and the overall value is in CDN dollars and because my account is in USD, if I sell, it will automatically be converted to USD into my cash account. My overall portfolio value is in USD so any currency loss will be reflected in USD. Hope that makes sense.

    • Only the currency spread will be lost.

      • Mark says:

        Maybe I’m not explaining myself clearly. I’m more concerned about the currency devaluation of the Canadian dollar relative to the USD. Let me give you an example. Hypothetically, I own $10,000 in Canadian index funds that I buy in December using 10,000USD. At this point of time, the currency rate is 1:1 (CDN:USD). Fast forward one year later (or 20 years for that matter), the fund has increased in value by 10%. However, the CDN dollar has decreased in value to 0.90:1. If I happened to sell all stocks (which I wouldn’t), my total profit would be 0 since my fund would automatically be converted back to USD and the currency devaluation would cancel out any increase in growth.

        Now of course I simplified this situation to illustrate my point. My point is that if I only hold my fund in one currency, aren’t I taking on more risk than diversifying with funds through multiple currencies, meaning buying funds through one stock exchange or the other.

        Then there is the added loss of buy/spreads and currency conversion fees that you mentioned earlier. I know there is the Norbert’s Gambit but my stock broker doesn’t allow this. What else can I do??

        • Mark,

          Many investors incorrectly think that if they buy an exchange-traded fund priced in a foreign currency, their money is subject to that foreign currency’s movement. This isn’t the case. For example, assume that a Spanish expatriate buys an ETF tracking the Spanish market. If he buys it off a British stock exchange, the investor will see the price quoted in British pounds. However, the movement of the English currency has no bearing on the Spanish ETF.

          Imagine the following scenario:
          – An investor buys a Spanish ETF trading at 20 pounds per unit on the British market.
          – Spanish stocks slide sideways, one year after the investor purchases the ETF.
          – The British pound falls 50% against the Euro

          The English pound’s movement wouldn’t affect the investment itself. In this case, despite the fact that the Spanish market didn’t make money, the ETF that was purchased at 20 pounds per unit would now be priced at 40 pounds per unit. The crash in the British pound would affect the price of the ETF, but not the overall value in euros. The Spanish market, and the value of the Euro, would be the only true factors influencing the value of the Spanish stock market ETF.

          Likewise, a New Zealander buying a global stock market ETF off the Australian market wouldn’t be taking a gamble on the value of the Aussie dollar. While the ETF may be priced in Australian dollars, its holdings reflect the currencies of the stock markets it tracks. If the Australian dollar dropped 90% compared to a basket of global currencies, a global stock market index trading on the Aussie market would shoot skyward in price. Australian dollar currency movements wouldn’t affect its true value.

          You will only have currency spreads to worry about, which are minor. Let’s pretend they’re 1% on either end. No big deal.


  30. Ed says:

    1.How do I go about finding out if these or similar zero capital gains strategies will work for a Norwegian living abroad?
    2.Do we not have to pay capital gains tax or similar in the country that we live in as expatriates?
    3.I’m currently still living in Norway and as far as I can tell I would have to pay 28% capital gains tax if I rebalance my porfolio- I assume this makes rebalancing a loosing strategy- so my question is will I still be able to make money on indexes if I am not able to rebalance my portfolio(or will I make much less…)?

    Thank you.

    • Hi Ed,

      The money isn’t earned because of the rebalancing. In fact, John Bogle did a tested a diversified portfolio that was rebalanced versus one that wasn’t over the past 30 years and found the one that wasn’t rebalanced did a bit better. Rebalancing does reduce some of the volatility, and during some time periods (who knows when they will be in the future?) results have been better. If you do want to rebalance, you can do so buy making additional investments each month or quarter to whichever index is lagging. That’s what I do.


  31. Ed says:

    Ok, thank you. I really appreciate you taking the time to answer these questions, as a newb there is a lot that is confusing:)

  32. Kyith says:

    i found this article recently on UK inheritance tax. i wonder if this changes anything. If our Standard Chartered Trading account is a nominee account, then wouldn’t as non domiciled folks not required to pay inheritence tax?


  33. John says:

    Hi Andrew

    I am just wondering if you still think bonds are a good investment? The reason I ask is due to the fact that Warren Buffet has recently described them as a “terrible investment” and stated that people could lose money on them in the future.

    If you do, what do you think of the Vanguard UK Bond ETF you listed above?

    Thanks and great book!


  34. Mark says:

    Hi Andrew,

    Thanks for your previous response. I can’t seem to find it posted in the comments section anymore but I’ll reply here.

    I understand your scenarios about the Spanish expat and NZ expat but I don’t think my example is quite the same. I asked Dan at the Canadian Couch Potato and he claried my problem. I’ll post mine again as others might be in a similar situation

    My brokerage portfolio is based in USD and when I first opened it, I mistakingly thought that I should have my fixed income invested in Canadian bonds. When I bought XBB, the CDN dollar was on par with the US dollar. My profit/loss is reported in USD and I noticed that although bond prices had fallen slighly in a year (-2-3%), my loss was compounded by the fact that the loonie had fallen about 10% relative to the US dollar. My fixed income had actually fallen closer to -12%. This is due to the fact that I am taking on additional currency risk by keeping my fixed income solely in Canadian bonds. To help mitigate this unwanted risk, I started buying roughly equal amounts of US bonds (BND) as well as buying extra in the CDN bond market (prices are cheaper now since I am buying using US dollars and converting to CDN dollars). As Dan from CCP pointed out, I actually have the opposite problem to most resident Canadians who buy bonds in the US market (BND) as their accounts are based in Canadian dollars. I realize that your above examples of VUN would help those people since they are traded through the Toronto stock exchange.

    Although I am Canadian, my future liabilities and my income is based solely in USD, so it actually doesn’t make sense to keep my fixed income solely within the Canadian market since I would be taking on additional currency risk. I would imagine others might be in that same situation so I thought I would share.

  35. Sean says:

    Hey Andrew,

    You may be interested to learn that Saxo Trading (they don’t like being called a bank) do not allow purchasing VWRL.L on their platform in GBP, only USD:

    “Dear Sean,

    Sorry for not able to add this ETF (GBP) in our platform due to system limitation.

    Please let me know if you have other queries or requests to add in other new ETFs and I shall try my best to assist you further.

    Thank you.

    Yours Sincerely

    Eoh You Loong”

    So I asked if they could add it …

    “I checked with my Stocks Desk and we are unable to add this ETF (GBP).

    We have the same ETF tradable in our platform but it is trading in USD and not in GBP. Hence due to system limitation, we cannot offer the ETF Vanguard FTSE All-World ETF (IE) (VWRL.L) – LSE ETF (GBP) in our platform.”

    I wonder other ‘system limitations’ they have. Do you have any other GBP ETFs you would advise that Saxo do allow us to purchase?

    • Sean says:

      TD Direct International allow purchasing of all the ETFs you recommend, in GBP (and lots of others).

      Their transaction fees seem alarmingly steep though, in the region of 30-40 Euros per trade.

      • John says:


        I also asked my SAXO rep about VWRL this week and he said exactly the same as your rep. I then thought that instead of having a GBP account, it may be worth having a USD account and buying the Vanguard S & P 500 ETF off the LSE. But to my surprise they only have this in GBP! It doesn’t make any sense!

        I think my plan now if to have a GBP account, buy VUKE (FTSE 100), VGOV (UK Bonds) and VWRL – even though you have to convert it to dollars to purchase it. It turns out that the commission (0.5%) goes against the trading rate, so to purchase 1000 pounds worth of dollars, it is only going to cost you an extra 5 pounds – it’s not too much.

        What do you think of the VGOV (bonds) ETF – it is a mixture of short, medium and long term? Could be risky!

        • Sean says:

          I’m planning on fouling my investment here on with about 30% in the FTSE (VUKE or HUKX) and 45% in Bonds (VGOV) and the rest in my UK trading ISA on VWRL, Which is supposed to be about 30% of my portfolio.

          I don’t want to touch anything in USD now all this estate tax is in the offing.

          Yes, I’m a little uneasy about the whole VGOV/Bond thing, but I’m also very trusting of Andrew’s advice! Someone posted about this on here, earlier this week, I’m waiting for Andrew’s response with bated breath…

          • Hi Sean,

            You could buy a U.S. stock index, as long as it isn’t domiciled in the U.S. I put ticker symbols for non domiciled ETFs in this post.


          • Richard says:

            Sean and Andrew

            Can I just confirm that the fact VWRL offered by Saxo trading in USD is fine to purchase as a British investor since it is domiciled in Ireland? There are definitely no issues regarding US estate taxes.

            Also, i am just running through all this in my mind regarding the purchase of an ETF in any currency. Am I correct in assuming that the purchase currency of the units is irrelevant apart from the exchange of currency at purchase and sale.
            Therefore the most important aspect is the acquisition of units regardless of their root currency. When you decide to sell you could choose whatever currency you like to take it in, assuming the bank will allow that, and not worry about currency fluctuations during the growth of your portfolio.


          • Richard,

            Your assumptions are both correct.



  36. Vig says:

    Hello –

    Yesterday Saxo’s Singapore rep told me in an email that there is no annual platform fee of 0.2% and they have no plans to institute one in the near future. So I guess we’ll see. This is good news for the time being for those who will be buying ETFs via S.S.

  37. Mr Curious says:

    Dear Andrew,
    Enjoyed your book and this site. This is all really good investment advice for those with even a modest salary, but how about those expats who work part time or freelance, or whose incomes are paltry, much lower than even a teacher’s salary? Is it cat food and fried crickets for them at 80 or what?

    • Mr. Curious,

      Cat food and fried crickets? To the contrary, I believe. Expats tend to think differently about retirement. At least, their scope tends to be wider. Can you live well on $20,000 to $25,000 per year? I think it’s possible. But you may have to consider alternative retirement locales. Instead of shovelling snow as a 65 year old in New York state, you might have to sacrifice the back aches, spending winters (or all year) in Thailand, Malaysia, Ecuador…or some other low cost locale. Here’s a book you might find worth reading: http://amzn.to/1kLk47A

  38. Ed says:

    What should I consider when deciding where to open the brokerage account (vether to open it in Lux or Hong Kong or Singapore)?

  39. Sarah says:

    Hi Andrew,

    I’ve just finished reading your first book and I’m a regular on the site but I’m still confused about how to apply the methods to my situation. I live in Brazil, married to a Brazilian with permanent residency here, but I am originally English. We don’t know whether we will stay here forever or go to the UK at some point or even elsewhere in the world. I am very concerned about investing our long term money in reais and having it all in Brazil, whose economy is historically pretty unstable, so I figured we could split our money 50/50 between Brazil (via a Brazilian brokerage?) and elsewhere (then split each 50% chunk into stocks and bonds as per your system).

    My questions are: does this seem like a reasonable plan, and where should the ‘elsewhere’ be? If we trade in the UK won’t we then be liable for UK taxes and have to declare any money we hold offshore? But if we trade in the US won’t we then be liable for US taxes? If we trade from an offshore brokerage I understand that we would only have to pay taxes when we bring the money into whichever country we want to spend it in, but which offshore brokerage should that be? (TD International? But then you said the 0.2% fee would take a big hole out of our pockets…)

    Perhaps I’m confused but if you invest via an offshore brokerage on the New York stock exchange for example, you aren’t then liable for US taxes… or are you???

    Also, on a more general note, do you recommend automatically reinvesting profits, because doesn’t this generate higher payments in transaction fees? Or would you recommend reinvesting in chunks (say once or twice a year)?

    Help! I’m confused! I know my questions are quite specific to my personal situation, (and probably quite ignorant!) but any advice you can give me would be most appreciated. Thanks.

    • Hi Sarah,

      TD International does charge 0.2% per year. But compared to nearly every other option available, this is a steal of a deal. You could most certainly open an account with them. You could also open an account with Saxo Capital Markets, based in Singapore or Hong Kong. I believe you can do so without having to visit either country, as long as you get a notary to verify your identity. Investing in the UK or the U.S. will attract unwanted taxes. In the U.S. case, your heirs would also have to pay estate taxes upon your death…something they could avoid if you choose a foreign brokerage, and non U.S. domiciled ETFs, as I have listed in this post. Hope that helps. My apologies for not giving a much longer, clearer explanation. I’ll do my best describing this all in my upcoming book for expatriate investors.


      • Sarah says:

        Thanks for the clarification Andrew! I really appreciate you taking the time to answer all these questions 🙂 Just one last thing – if you have time – do you think its worth splitting our money 50/50 between an offshore investment platform and a Brazilian one, or should we put it all offshore? The reasoning was that we could avoid the currency conversion costs with at least 50% of our accumulated wealth if we choose to retire in Brazil (since I don’t think any offshore investment platform allows you to hold accounts in Brazilian reais), but at the same time, once we’ve transferred our money out of Brazil into pounds it would be held in a more stable currency, and we’d have averaged out the currency conversion risk over several decades of moving money out of reais, plus if we chose to retire in the UK, half of our wealth would already be in pounds. Is this sound reasoning, or I am I making things unnecessarily complicated? Thanks so much!

  40. Matt says:

    Hi Andrew,

    I feel am another one of the lucky ones who was looking for pension/retirement plan options for expats here in the UAE, was referred to a brokerage firm selling the Zurich plans, crunched some numbers in excel and had my reservations, but was unable to find another option so was contemplating signing up just to “get started”. Luckily I found your website (and confirmed my suspicions about these retirement plans) before signing and now I am in the process of opening an account with Saxo (they have a branch in Dubai now) and becoming another Canadian couch potato. I have your book on-hold for me at Kinokuniya.

    I have a couple of quick questions:

    1. I have the option to open the account in CAD (or other currencies for that matter), which I believe would negate the 0.5% fee when buying ETFs on the Canadian market, correct? Is this also true for any U.S./International funds I would purchase through the Canadian market?

    2. Would you agree that it would be better to open the account in CAD as opposed to USD? My income is in AED so I would have to exchange currencies anyway, but I believe I was told that if I can convert the money though my other bank to CAD first, then I would only pay that bank’s exchange rate (and not the 0.5% fee for the exchange if I directly transferred it in AED).

    3. To clarify, this 0.5% fee from Saxo is for any currency exchange correct? Whether it is into/ out from the account or buying/selling stocks/funds etc?

    Thanks in advance,

  41. Matt says:

    Hi Andrew,

    Bought your book and read it, excellent stuff. Funnily enough I used to go to SAS to train back in the 90s, although I think you guys have moved campus now (I was a UWC student).

    I’m a British teacher based in Vietnam and was wondering whether you (or anyone else) can advise me on whether you think 8% interest rates in local Vietnamese short term (1 year) saving accounts would be worth considering instead of short term bonds? Banks are also offering 6.5% over 6 months.

    The dollar has been pretty stable against the Dong (as they are linked) but the Dong is sliding badly against the pound- down 12% over the last year. This makes me reluctant to use my money to buy UK stocks.

    I’m not sure whether to just go with Saxo and start buying ETFs and bonds now, or split between Saxo and a local short term account.



  42. Kevin says:


    Currently I have a non-registered account with TD Waterhouse. I am wondering if I will have to transfer everything into a registered account if I ever move back? Is there anyway around this especially knowing about tax implications of
    registered vs non-registered?



  43. Wayne says:

    Hi Andrew

    On the subject of US estate taxes – I presume though that this would not apply to a living Trust where the settlor(s) pass away? Perhaps there are other issues Trusts raise, but I am the settlor of a NZ foreign Trust which is registered with an Interactive Brokers trading account based in Hong Kong. Would using this vehicle not preclude the attachment of US estate taxes and therefore remove the necessity to move out of US based ETFs?

    A related query, I notice you mention Saxo Bank, TD International and DBS Vickers as options for most expats living outside countries the US, Canada or Australia. Is there any reason you have not mentioned Interactive Brokers as an option?


    • Hi Wayne,

      Is Interactive Brokers a U.S. brokerage in the same ilk as Singapore based E-Trade? If so, they are both U.S. brokerages and would attract U.S. estate tax. I have not heard of a way around this issue with Trusts. I imagine if it were this easy wealthy Canadians would do so with their U.S. domiciled ETFs. Of course, it’s possible. But if the brokerage you mention is a U.S. one, I wouldn’t recommend it to readers.

      • Wayne says:

        HI Andrew

        Thanks for the info. It may or may not be for further interest but I delved a little more into the foreign Trust question and found that a foreign trust in itself would not offer protection from US estate taxes. That said, there are two points which I found interesting:

        1. US assets held in a foreign corporation , owned by a foreign trust would offer such protection (but only to non-us beneficiaries) although such a construction may be cost prohibitive, in the short term anyway.

        2. It is unclear how the IRS would be in a position to know of a foreign Grantor’s death in the first place. The article below posits that this would only be imaginable in the event all US based assets are liquidated, which may prompt the agent to question the reason, or their are US beneficiaries involved. So really, provided the Trust assets are not liquidated all at once, it is very unlikely a grantor’s death would invite estate taxes. That said, the liability is still there and therefore the risk clear (for more see .

        On Interactive Brokers, if I understand your comment correctly, any US based broker would attract US Estate taxes, irrespective of where the ETFs you invest in are domiciled (for example, if I use IB or E-Trade to buy Vanguard ETF on the TSX, I would pay Estate taxes on that investment too)?


        • Thanks for this Wayne.

          And to answer your question, yes, any U.S. brokerage (regardless of which country you access it from) puts non-American expats at risk of having to pay estate taxes. For this reason, I don’t recommend E-Trade. Thanks for bringing up Interactive Brokers. I still have time to add it to my next book’s warning list, alongside E-Trade.


          • Mohamed says:

            Hi All,
            Can you give some hints about interactive brokers compared to SAXO, I would like to decide on which one to open an account 🙂

            Thanks,keep it up 😉

        • Wayne,

          It appears Interactive Broker allows access to foreign exchanges: British, Canadian etc. This is good and you wouldn’t be liable for U.S. estate tax, unless you trade on the U.S. exchange.


          • Wayne says:

            HI Andrew

            Thanks for the update. This is good news, as Interactive Brokers cannot be beaten for fees, especially for Dollar Cost Averaging investors such as myself (Saxo Bank fees for example would force me to invest every 4-5 months instead of every month). Even the IB min total activity fee is waived with accounts over US$100k. I am not trying to plug IB and I am not sure how this fits in your book, but I am your for sure your target market, and I would be interested to know if there are better options for online brokers for global expats who would like to invest DCA from outside the US.

            Thanks again- please hurry with your book!


          • Thanks Wayne,

            Which market do you use with International Brokers and what’s your nationality? Do they provide access to the British and Canadian exchanges? If so, would you mind doing me a favour? If you are using this brokerage and accessing a market other than the U.S., then I would like to profile you in a few lines for my book, as well as describe your experience with the brokerage, and provide a screenshot of a Canadian international ETF purchase: VDU. I did the same thing, assuming investors bought 370 shares, for DBS Vickers, Saxo Capital Markets and TD Direct International. I have also done a comprehensive cost comparison for each of those brokerages and would like to add your brokerage if possible as well. Thanks, Andrew

          • Guillaume says:


            Thanks for you book. Great read and brings me so many answers noone else seems to want to answer.

            I have an account with Interactive Brokers from which I trade UK and European stocks, and now will start placing my ETFs. I like this platform a lot…

            So, am I right with the following assumptions :

            – I should avoid to have any US stocks at all anywhere in the world to exceed $60k, including US domiciled ETFs that hold US stocks.

            – The UK/Euro stocks would be non affected even if traded through Interactive Brokers.

            – If I buy a US ETF that has US stocks but is listed in London, then… be on the safe side and put that off US in the TD International Account ?

            – If I buy any ETF listed in the US, whether it holds US stocks or not, then… again, be on the safe side and trade that outside the US the in TD International Account ?


          • Hi Guillaume, I’ve answered your questions here:

            So, am I right with the following assumptions :

            – I should avoid to have any US stocks at all anywhere in the world to exceed $60k, including US domiciled ETFs that hold US stocks.
            Yes, as mentioned in my book, this is correct.

            – The UK/Euro stocks would be non affected even if traded through Interactive Brokers.
            As mentioned in my book, maybe, maybe not. Please read the section on Interactive Brokers again.

            – If I buy a US ETF that has US stocks but is listed in London, then… be on the safe side and put that off US in the TD International Account ?
            Sorry Guillaueme, I may not understand this question. But I’ll try. If that U.S. index is listed on the UK market, your heirs won’t have to pay U.S. estate taxes. However, they may have to pay U.S. estate taxes if you hold it with Interactive Brokers.

            – If I buy any ETF listed in the US, whether it holds US stocks or not, then… again, be on the safe side and trade that outside the US the in TD International Account ?
            Yes, as mentioned in my book, this is correct. If you want, you can hold up to $60,000 USD on a U.S. exchange, but otherwise, your heirs take the foreign estate tax risk, upon your death.

  44. Vig says:

    Hello everyone.

    Does anybody have a screenshot, with annotations, that they can share as to how to buy index-tracking ETFs from Saxo Singapore? I just want to buy and hold 3 or 4 ETFs for the long term.

    I know how to use Saxo’s WebTrader software, but am unsure of which drop-down menus to select, which option boxes to tick, etc. The Help file for this software isn’t very helpful. It doesn’t explain what certain words mean. I don’t want to accidentally choose the wrong purchase option when I buy my assortment of ETFs.

    Thanks folks ; )

    • Mark says:

      Yeah, Saxo’s interface is not very user-friendly. Can’t upload a screenshot to this site but I’ll try to explain the best I can.

      1. Go to the stocks section tab
      2. Click on create an order (bottom of the screen)
      3. Under “select instrument”, type in your stock code (VTI, VXU, etc), make sure it is not CFD but the EDF icon.
      4. You should see a tab come up. Enter how many shares you want to buy (it should automatically calculate the total price). Enter the price per share you want to pay, make sure it is on “limit” (not market). You will have to play with the price a little as the price obviously fluctuates and if you bid is too low, the order won’t go through. Look at the bid/ask price.
      5. Sit back and wait for your trade confirmation to go through (remember it has to be during NYSE working hours).

      • Thank you Mark,

        Saxo Capital Markets is a brokerage that wants people to gamble. As such, they have so many bells and whistles on their site that normal investors (those that truly want to make money and not just fool around) have a tough time negotiating through all the speculative options to get to a simple trade application. I use this brokerage. And by far, it is the most complicated platform I have ever used. And I have used at least a dozen different brokerages at one time or another. Thanks for helping! Andrew

        • Vig says:

          Hello Mark and Andrew,

          Thanks for that.

          Both Saxo’s web-based & downloadable platforms are convoluted and counter-intuitive. It’s not as straightforward as I had hoped.

          One question — and it may be a dumb one: Why not just place a Market Order instead of a Limit Order? Surely you won’t save that much cash on the purchase, right?

          • Hi Vig,

            Personally, I always go Market, not Limit. At times you win, at times you lose….but margins are very very slim and inconsequential long term. Besides, when going Market, the gambling bone never gets tickled and every transaction clears.



  45. Ed says:

    Hi Andrew

    I’m a 48 year old UK expat, resident in Indonesia for the past 20 years. I bought your book last year, thought it was fantastic, and have been planning on getting started with a portfolio ever since.

    I have some Canadian mining stocks held with TD International for several years and have just been told that they no longer want Indonesian residents as clients. They will transfer my portfolio free of charge to another brokerage. This situation has therefore forced me into taking some immediate action with my investment plans. I have a few questions for you

    .I ‘ve been looking at Singapore brokerages to transfer the mining stocks. As these stock are so deeply in the red I can’t bring myself to sell them, so I guess transferring them is a better idea than selling them ?
    At the same time as the transfer, I plan to invest cash savings of $300,000 in a portfolio of ETF’s and bonds . I see that OCBC offer quite a complete trading platform. The costs look similar to other brokerages in Singapore. Do you have any opinions of OCBC ? Or do you recommend I go with DBS Vickers ?

    2 . My wife is Indonesian but we are not sure where we will end up living. We have property here in Bali, but we may end up splitting our time between Australia and Indonesia. What markets would you suggest to invest in ?


    • Hi Ed,

      Saxo Capital Markets (Singapore) will allow you to trade on the Canadian or British market.

      On another note, let me ask this question: If I gave you $20,000, would you use it to buy those same mining stocks that are currently in the red? When answering this question, you will likely think with your head. You will consider the long term odds of such money’s growth and make a rational decision (let’s hope). But when we already own something, we think much more with our hearts. By choosing to hold those stocks, you are saying, “I would buy them today with fresh capital.” Don’t let your heart, pride or fear make your money decisions. If you would buy those stocks with fresh money today, then hold them. If you would not, then sell them and diversify the remaining money appropriately.


  46. John says:

    Why not just select ‘market’ and not ‘limit’? What is the difference? I agree with both of you – the trader is a minefield for the inexperienced!

  47. Douglas says:


    Fantastic stuff. As a non-resident Canadian living and working in Singapore a quick question on tax for a portfolio made up of Vanguard ETF’s on the Canadian Stock Exchange;

    1. No Capital Gains Tax here in Singapore (This I know)
    2. Is there any Dividend withholding tax here in Singapore for such holdings?

    I ask about #2 as I make the final choice of opening an account with DBS Vickers or as a Non-Resident TD Waterhouse acccount. The advantage to DBS, aside from the fact I work and live here, is perhaps not having any dividend withholding tax. Correct?

    Thanks and look forward to your new book in the fall.

  48. Ali says:

    Hi Andrew:

    I am a non-resident Canadian living in the Middle East about to invest with a US brokerage firm. Am I correct in understanding that 30% tax will only be withheld for US-based income e.g. ETFs that invest on the US stock market?

    I believe ex-US ETFs would incur no such tax?


  49. Mark says:

    In addition to other sneaky/hidden fees. As of March 1, 2014, Saxo has now introduced an “inactivity fee” (bad for couch potato investors) in which if there is no trade done within 6 months, they will impose a charge of $100. Not really a big deal since most passive investors will still make a couple of trades a year but still something to be cognizant about.

    I haven’t heard about the 0.2% fee from Saxo yet.

  50. Ali says:

    Hi Andrew,

    in my rush to open an account I completely forgot about this. Red-faced now as I will have to close the account I just opened in the US to focus on my TD International application…


  51. Emrys says:

    Hi Andrew,

    I’m a Malaysian. I picked up a Taiwanese edition of your first book and have been following your blog for a few months. Now I’m planning to start investing. I have a few quick questions here:

    1. I read a Singaporean investor’s book and he uses E-trade. Any difference between E-trade and DBS Vickers/Saxo?

    2. I’ve been researching for the tax issue for a while. From your blog I understand that there is a withholding tax on dividend. And from another forum I learned that Malaysia has no tax treaty with the U.S., therefore Malaysian investors have to pay capital gain tax to the U.S. government (just like U.S. citizens), is this true? If yes, does the capital gain tax has to be filed or it works similar as the dividend tax? E-trade refused to clarify further on this as they claimed they are not licensed to advise on tax issues.

    I hope to understand this before I proceed to open a brokerage account. I’m open to any possibilities and inputs.

    Thanks & Regards,

  52. Bryan says:

    Hi Andrew:

    I read your first book and really enjoyed it. Thanks for all the great advice. My wife and I are Canadian expats teaching abroad. Two years ago we traveled to Singapore to open an account with DBS Vickers. We currently own US and CAD ETF’s and after reading this article I’m curious about what you would recommend as our best avenue for success.

    If possible I’d like to open an account through TD Waterhouse in Canada. We’re home for the summer and I could open an account now. Could we then transfer our stock purchases over to that trading account using a security outward transfer form and then sell the American ETF’s and purchase the new stocks you are recommending? Would this be advantageous for us? Or should we attempt to open an account with either Saxo or TD International?

    Thanks in advance and I look forward to reading your next book.

    • Hi Bryan,

      You could just sell the U.S. domiciled ETFs and buy Canadian ones via DBS Vickers. That’s a pretty simple solution. What school are you at? Many global expat administrators are ordering copies of my book for staff at cost–due November 2014. Do you think your school would be interested?



      • Bryan says:

        Hi Andrew:

        Thanks for the prompt response. I work at the American International School – Riyadh. I will speak with our Director of Learning. We have a pretty robust PD library and I think we probably would be interested in some copies of your new book.

        Last question and then I will wait until November. My understanding from the article is that you were advising people to switch companies because of the inherent cost of selling and buying with DBS Vickers (I think it would cost about .85% to sell American and buy Canadian). Is that correct? So far I’ve been happy with DBS Vickers and am happy to stay on with them if it will not be cost prohibitive. I’m really curious about the downsides of having a TD Waterhouse account as we travel home each summer. Is it just the concern over it possibly being used against us if we were to try and repatriate?

        Thanks again for your quick response and I will email our director of learning today!


        • Bryan,

          If your account value is huge, and you’ll be switching all of your U.S. ETFs fro CDN ETFs, then yes, you can save money by transferring the assets (not selling) to another brokerage (ie. DBS to Saxo) then make the trades to CDN ETFs from there. But if you don’t have a massive portfolio, there’s not much point to that.

          If you are comfortable with a TD Waterhouse account, go for it. I’m not personally comfortable with it. But that doesn’t mean you shouldn’t be. I’m a wimp–won’t even ride a roller coaster…couldn’t be paid to bungy jump.


  53. Justin Hardman says:

    Hi Andrew,

    What is your advice to non US based expats (based in HK) that want to invest in the US market (ETF’s for the most part)?

    I just opened my trading account (saxo) and was stunned by the 30% withholding tax. Is there a way that this can be avoided or reclaimed. The ETF options are far fewer in HK


  54. Ali says:

    Hi Andrew:

    I thought I had this issue fully understood but I might be confused:

    1- as a non-resident Canadian with an account with TD International, don’t I avoid US estate tax? I thought it would only be applied if my broker was US?

    2- same for the withholding tax? I thought I would avoid it by investing through TD International?

    I now think I might actually be wrong on both counts!

    In which case I will sell all my US ETFs (VEA, VTI, BND) and buy Canadian ETFs (VUN, VDU, VSB) on the TSE.

    I think that was your advice all along but I somehow misunderstood it.


    • Hi Ali,

      Yes, you’ll need to switch to Canadian domiciled ETFs, in other words, ETFs that don’t trade on the U.S. market. You could still build a diversified portfolio (with U.S. exposure) but don’t do so with U.S. domiciled products. You could choose from the ETFs in this post. You will still pay witholding taxes of 15% (not 30%) but you won’t have to pay U.S. estate taxes.

  55. Ali says:

    Thanks Andrew. It is obvious when I re-read the article, can’t believe I missed it the first time: it is the very point you were trying to make!

    Will your new book be available for purchase as an e-book?


  56. Mark Holmes says:

    Not sure if this question fits with the others, but didn’t have anywhere else to put it. Perhaps it should be on an another forum.

    I believe it is possible to continue owning a property in Canada after declaring non-residence, as long as the property is rented out (kept at arms length). When we left Canada we weren’t in a position to buy a property (which is partly why we left). As international teachers we now seem to spend the summers with our kids staying at relative’s houses in BC. We’d really like to buy somewhere that we could use in the summer. How would the CRA perceive a Canadian non-resident buying a property after declaring non-residence? We would be happy to rent it out the other ten months of the year.

  57. Mike P says:

    Hi Andrew,

    I’d like to express my thanks to the service you’ve been providing to expatriates and international teachers. After reading your book, website articles, and this message board I’m now investing in ETFs and feel good about my long term financial goals while being overseas. Not to mention finally having a good comeback when my friends back in Canada keep pestering me about how I’m losing out on a good pension when I retire!

    I’ve been teaching overseas in China and (now currently) Korea for the past 5 years, and this summer while back in Canada I opened a non-resident discount brokerage account with TD. It was very simple, though initially it took some convincing to the person on the phone to make the appointment. The only downside was that because I’m a non-resident, I cannot trade in mutual funds, so the prized TD e-series funds are not an investment option.

    Luckily, the discount brokerage advisor was helpful discussing ETFs and how to use the online brokerage system. I showed him your Vanguard ETF recommendations along with the Canadian Couch Potato model portfolios. Other than the low MERs of each fund, TD charges $10 per trade – seems fair to me. This morning I placed my first order with the following proportions:

    VCN – 25%
    VUN – 25%
    VDU – 20%
    VSB – 30%

    I’ll be turning 30 in a few months, so I feel comfortable with the amount of risk in this portfolio. My plan is every 5 years to increase the amount of bonds I hold by 5%, and to contribute to this portfolio with a lump sum once a year.

    The advisor mentioned that TD takes care of any and all tax information, so there is nothing I need to worry about while I’m overseas with my non-resident status. Almost seems a bit too easy, once it’s setup.

    I have a few questions that I hope you’d be able to answer:

    1. What is the minimum contribution I should keep in mind when trading in ETFs? I’ve heard different amounts thrown around from $3000 – $10000, so I don’t know what to believe.

    2. The non-resident tax-issue seems almost too easy now that my brokerage account is setup. Is there anything I should be aware of that TD may not have told me?

    3. Are the ETFs and the proportions I’ve used seem reasonable? Would there ever be a time when I would need to “switch” ETFs?

    Thanks again for all your advice, and look forward to reading your next book!

    • Hi Mike,

      I looks like you have set up a great portfolio. As for limits on purchase orders, there are no minimums. You’ll be charged a flat $10 per trade, so of course, it doesn’t make sense to invest just $50 at a time, so just keep that in mind.



  58. Alex says:

    Hi Andrew,

    I stumbled across your site yesterday evening and have found it really informative. I am currently a British expat in Singapore (with Singapore PR status and 32 years of age if that helps) and hold a portfolio largely based on Allen Roth’s 2nd Grader Portfolio (which can be found here for those interested —

    I have squirreled away approx. 100k USD into the three Vanguard ETFs over the years and came across the 60k USD US estate tax law at the top of this thread and I started to get a little nervous!

    I work in financial services and we only have certain approved brokers that we can interact with (mine being UOB Kay Hian) and Saxo is not on that list. I was wondering if there was any advice you might be able to provide as I would like to mitigate that tax risk wherever possible as and when I purchase future ETF allocations moving forward.

    I would also be keen for our company to offer your book to our new and existing expatriate community in our office in Singapore (~100 or so employees) I’ll contact you separately on that.


    • Hi Alex,

      After a quick look at UOB Kay Hian’s brokerage, it looks like you have access to the Hong Kong market. This is a market that’s three or four times as liquid as the Singapore exchange, and it has a wide variety of excellent ETFs to choose from. If you cannot use TD Investing International, Saxo Capital Markets or Interactive Brokers (to name three examples providing access to the London exchange) then the Hong Kong exchange would be a fine fit for you. By using this exchange to buy exchange traded funds, you won’t be putting your heirs at risk of paying U.S. estate taxes if you get hit by a bus.

      2805.HK Vanguard FTSE Asia ex Japan Index ETF – tracks the FTSE Asia Pacific ex Japan, Australia and New Zealand Index
      3101.HK Vanguard FTSE Developed Europe Index ETF – tracks the FTSE Developed Europe Index
      3056.HK Horizons S&P Global Consumer Brands ETF – tracks the S&P Global Consumer Enterprises Index

      This last index is the closest you’ll get to U.S. exposure, considering it has 38% exposure to the U.S. You can see its components here:

      If you do want a specific and broader U.S. ETF, you could buy one off the Singapore exchange. Its liquidity would likely be less. But as a long term investor, that shouldn’t matter much. The SGX is getting better, in that regard, every year.

      I hope this helps.

  59. Andy says:

    Hi Andrew,

    I just finished reading your second book (my Kindle pre-order was delivered early). Thanks for the excellent information. It cleared up some of my questions.

    I’m an Australian expat living in Vietnam. I have opened a DBSV account in Singapore based on your previous advice on this blog, however I have not started investing with it yet.

    From the information in your second book and this article, it seems DBSV is not the best option for Australians anymore since we can’t access the Australian stock market. Is this correct?

    Should I close the DBSV account and open one with TD international (though I did read a comment from a British expat in Vietnam back in an earlier that TD won’t open accounts for those living in Vietnam)? Or since I have the DBSV one open already is there a way to use it to access the Australian stock market without buying through US listed stocks?


    • Andy says:

      Hi again Andrew,

      Just to confirm, when I go to TD International via the link in your blog post and fill in country of residence: Vietnam, nationality: Australian, TD International gives the message ‘Residents of this country are not allowed’.


    • Hi Andy,

      Considering you are Australian, you may consider Interactive Brokers or Saxo Capital Markets. I know, for sure, that Interactive Brokers would allow you to open an account.

      • Andy says:

        Thanks for the replies Andrew. I will look into Saxo and Interactive Brokers, though I remember from your new book you mention there may be US tax issues because it’s a US company.

        I do have a DBS Vickers trading account already open, but I haven’t used it yet. Originally I was going to buy this, based on the information from your old book (based on my age, 35):

        35% – ISHG
        50% – EWA
        15% – VT

        But I think this means I would buy into the Australian Stock Market via the US, which I should not do now because they are US listed stocks?

        If I can’t sort it out, I will be leaving Vietnam at the end of this academic year. It might be easier to set-up from the next place.

  60. Jason says:

    Hi Andrew

    Wow I just came across your first book by total chance and ended up purchasing your second book on expat investing this morning. I really wish I had found it about a month ago (actually 5 years ago would have been perfect).

    Basically in a nutshell I have been working and living overseas in the middle east for about 6 years and now I am in Turkey. I was duped into “Friends” Provident in 2011 by a friend of a friend… I finally saw the light about 2 months ago and quickly tried to fix my retirement funds as best I could. I got as much money back from FPI without incurring their insane cancellation penalties and at the same time opened up an account with TD Ameritrade… (I had no idea about TD Direct International until today) The reason being was the several brokerages I contacted in Canada and the US would not open an account for me as a non-resident. Plus TD Ameritrade offered commission free ETF trading and the MER’s for Vanguard US are the lowest there is. I filled out the W8BEN and sent it to TDA and thought I had covered all my major tax risks and had a total MER of 0.08% with the following ETF’s and positions.

    VTI – 60%
    BND – 10%
    AGG- 10%
    VEA – 10%
    VGK – 10%

    As you can see it is heavily invested in US stocks and bonds.
    I didn’t realize that there was a risk of this estate tax law until today coming to your blog.

    So… I am heading back to Canada in December. I think the cheap and best scenario is to open an account with TD Waterhouse and move everything over from TD Ameritrade. I’ll be facing higher MER’s and have to pay trading fees but they seem pretty low to me against the risk of facing estate tax. I plan on moving back to Canada eventually so I think it makes more sense to stick with TD Waterhouse.

    Do you have any thoughts or suggestions?

    Thanks for the article. I plan to start on your book tonight.

    Best Regards


  61. Kiat says:

    Hi Andrew
    I’m a british expat based in Hong Kong. I’ve been investing with the US-based Interactive Brokers (HK branch) for a couple of years now. I’ve just finished reading your second book and it’s terrific – just like your first book was. However, there does seem to be a bit of a contradiction (or confusion?!) regarding whether it is recommended for non-US persons to invest with US-based brokers at all. Even though Interactive Brokers allow you to buy non-US domiciled ETFs in currencies other than USD, wouldn’t my heirs still be liable for estate tax on the amount over 60,000 USD (mine is quite a fair amount greater than this) because the funds are technically situated with the broker in the US?

    • Hi Kiat,

      You’re probably OK with Interactive Brokers. But I wanted to throw in the caution…just in case.


      • Kiat says:

        Thanks for the prompt reply, Andrew. By ‘probably’, do you mean you would stick with Interactive Brokers (HK) if you were in my position? I’ve been trying to search all over to find a clear answer to this conundrum but there is little information out there about the tax status of non-us investors investing with us-based brokerages. I’ve even phoned Interactive Brokers (HK) about it and they did NOT refute my claim that my six figure portfolio of non-us domiciled funds denominated in HKD and GBP is still liable for estate duties because IB are a US-based broker and the funds are situated in the US. They simply told me that if I was worried about it I should transfer my funds to another broker!

        • I’m guessing you’re OK with Interactive Brokers. But I don’t know for sure Kiat. I don’t think the folks at Interactive Brokers even know. That said, brokerages don’t usually care to give tax advice of any kind, even really general stuff. Interactive Brokers wasn’t created to serve individual retail clients. They’re more of an institutional trader that investors can use. I liken them to jumping on a super fast transport aircraft to get to your destination. Don’t expect peanuts and chips.


  62. Neil says:

    Hi Andrew,

    It seems like Canadians get a similar “unified tax credit” as US residents do, and so the estate tax would only kick in once the deceased net worth is over USD$5.25million. This page explains it well http://www.taxtips.ca/personaltax/usestatetax.htm, and they provide a tax calculator here. http://www.taxtips.ca/calculators/us-estate-tax/us-estate-tax-calculator.htm.

    Of course this is not a substitute for professional advice, but I think it gives a good overview as to how this estate tax applies to Canadians.


  63. Wayne says:

    Hi Andrew/ Kiat

    I faced a similar conundrum earlier the year (I am currently with IB HK) and investigating further with investment colleagues and a few attorney mates with a common interest we reached the conclusion that there is one way to avoid having to pay the US Estate taxes, while still investing on the US Exchange and/ or a US domiciled broker. Whether it is a practical option depends on each investor’s circumstances but it does seem that for the larger accounts, it is worth looking at.

    Essentially, the US Estate taxes, as implied, are only triggered at the time of the investor’s death. Even with a Trust, the Estate tax can be triggered upon the settlor’s death, but not so with a corporation or company. Even though the company may only have one shareholder, this shareholding can be passed onto heirs without affecting the legal nature of the company, or its positions in US domiciled stocks and bonds. I have at least one colleague who has employed this tactic, set up a company in the Seychelles (Tax Haven) and uses this company to trade through IB across all exchanges, the majority in the US.

    This is not for everyone, perhaps only a few, so Andrew’s warning and advice to move to non-US domiciled exchanges and brokerages remains the best alternative for most of us. The setup and maintenance costs of such a company can have the same effect as Custody or Account fees on your portfolio if below a certain size. However, since these are usually fixed amounts, there will come a point where the size of your portfolio will reduce these fees to a negligible percentage – and swing the returns in favour of access to more cost effective Expense Ratios of US based ETFs.

    In summary this method is not avoiding the US Estate Tax law, it is just creating an investment vehicle that does not see it triggered in the event of the investor’s death.

    Hope this is of some help.

    • Kiat says:

      Thanks for your information, Wayne – it’s very helpful. So will you be moving your assets from IB (HK) to a non-US broker, soon? If so, what steps will you be taking? I’m trying to figure out how to do this with minimal cost.

  64. Michiko says:

    Andrew, I opened a Saxo Brokerage account and bought 20k worth of VTI Shares. They charged me a one time 20 dollar fee, and then at the end of the month stuck an extra CLIENT CDF FINANCE CHARGE OF 32.89 that You Loong Eoh (real nice guy, I like him lots personally) is telling me IS RECURRING MONTHLY! That’s like close to 1.2% on my 20,000 investment!


    • Hi Michiko,

      My big concern is why you bought VTI, exposing yourself to U.S. estate taxes. As for the other fee, I don’t see such a thing occurring on my account. Perhaps there’s a mistake. But it’s very important that you read the post you have commented on very carefully, and get out of VTI.


  65. Mark says:

    So anyone see the latest change to fees in Saxo? Here’s the email I got:

    “For the purpose of ensuring a cost structure that reflects the client’s actual usage of the trading platforms, Saxo Capital Markets has decided to implement a new fee structure in 2015.

    Custody Fees for Stocks*, ETFs/ETCs and Bonds
    For accounts with Stocks, ETFs/ETCs or Bond positions, an annual custody fee of 0.12% with a monthly minimum fee of SGD 5 will apply. The custody fee will be calculated daily using the end of day values and charged on a monthly basis.

    Annual Custody Fee
    Monthly Mininum Fee
    Stocks 0.12% SGD 5
    ETFs/ETCs 0.12% SGD 5
    Bonds 0.12% SGD 5
    * Singapore Exchange Limited Stocks will be exempted from the above fees.

    Please be aware that the new fee structure and custody fees will come into effect on 1st January 2015.”

    So looks like brokers are catching on to us passive investors and we are not generating enough money for them. Although the fee is still pretty low ( it is still much lower than the fees charged by mutual funds), is it worth paying this over the long-term?


    • Mark,

      I mentioned this fee in my book, suggesting it was upcoming. However, the fee they decided to levy is lower than the fee they told me they would levy. So this is good news. If you look at the comparative tables in my book (comparing brokerages) you’ll see that I calculated a fee of 0.2% for Saxo. But in reality, they decided to go with a lower additional fee.

  66. Anze Sparovec says:

    Hi Andrew,

    I just want to provide some clarifications on your section for Australian’s. I hold some of the funds with a an Australia brokerage.

    “According to Saxo Bank Singapore’s Senior Manager, Eoh You Loong, the dividend withholding tax rate on Australian ETFs is 30% for expats.”

    That is only true of the two cross listed ETFs (VTS and VEU). All other Vanguard Australia ETFs are domiciled in Australia and have a 15% dividend withholding tax as per the Australia and Singapore DTA.

    “There are no capital gains taxes if the account is located in Luxembourg, Singapore or Hong Kong.”

    My understanding is that there are no CGT on any accounts, even if held in Australia. I hold ETFs with CMC Markets in Australia and will only be liable for CGT on gains from the time I move my residency status back to Australia. You are only liable for CGT while an expat on immovable property (ie Real Estate).

    — Anze

  67. Anze Sparovec says:

    Actually one more thing. In your book you do recommend VTS and VEU for Australian expats. As they are cross listed you are actually liable for US Estate taxes, which I think some investors will need to be made aware of.        


  68. Inchvbeam says:

    Hi Andrew,

    Sorry Im interested in the plausible estate tax charges on assets held by interactive broker (or any US-based broker) and couldn’t help but noticed that you were more inclined towards not using US-based broker to hold non-US domiciled ETF.


    Anze & Andrew,

    If you could have the time, would appreciate if you could take a look at:


    where people were also discussing about such estate law matters.

  69. JB says:

    Dear Andrew,

    I have been following your blog for the past 2 years and this has been a real eye opener for me. I have also managed to read both your book recently. I must confess that it all seems a bit easy in the beginning but when it comes to actual trading there is a still a lot to learn and understand. The whole experience has left me in a state of confusion.
    I am 40 yrs old British expat of Indian origin living in Singapore since 2012. I have recently acquired PR status and plan to settle here. After reading your first book I decided to open an account with DBSV (april 2013) and invested my savings (USD 100K) into the following:
    VT 60%
    BND 40%
    It was going well until I learnt about the US estate tax, which created a bit of panic. Weidly, I had bought a term life insurance a couple weeks before discovering it. I sold everything and parked my funds in my DBS multi currency account. I realised that DBSV wasn’t ideal for investing in the UK market, so I opened Saxo Capital account (last week). As I was trying the Demo account I realised that it doesn’t let me invest in VWRL (GBP) but has the option of VWRD (USD). In your recent book you have described a global nomad couch potato portfolio and have mentioned VWRD, however you have suggested VWRL on the website. Which should I choose, keeping in mind that Saxo does’t have VWRL option( not sure why) and what bond option do I go for? You mention SAAA in your book.
    Is there a big difference in choosing a currency to invested in LSE considering the fact that I had converted SGD to USD for buying the US ETFs. Currently the proceeds of the sale is in USD.

    I have tried to persuade a few friends to look into index ETF investing but they have been dismissive of idea of “taking charge” of their own investments. One of my friend also went ahead and bought Zurich Vista last year despite me repeatedly warning him. Currently I don’t have anybody to discuss investment related issues. I would appreciate your advice and comments. I would like to have a couch potato portfolio but haven’t made up my mind whether to go for ‘nomadic’ or ‘settled’ option.



    • Hi JB,

      The currency denomination of the ETF isn’t relevant, as I mentioned on page 193. If you were paid in British pounds, if would be slightly more economical to buy a global stock ETF denominated in British pounds because then you wouldn’t have to convert currencies. But if you are paid in SGD, that’s irrelevant. Remember that when you invest in a global stock index, you aren’t investing in the currency that the ETF is denominated in…as mentioned on page 193. When you do move the money, years from now, you will take a currency commission hit, if you buy the ETF in USD and wish to convert the proceeds (years from now) to GBP. But other than this irritation, the currency it’s denominated in won’t have any impact.

      As for your bond index, the base currency of SAAA is actually in USD. So considering that you have USD, currently, this should be a very natural fit. You won’t have to pay a currency conversion to make the purchase.: http://www.ishares.com/uk/individual/en/products/251404/ishares-global-aaaaa-government-bond-ucits-etf

      Keep doing what you can to educate your friends JB. If just one of them listens, you will save that person hundreds of thousands of dollars or pounds over a lifetime.


  70. JB says:

    Hi Andrew,

    Thanks very much for your comments. I received an official reply from Saxo Capital Markets. VWRL and VWRD share the same ISIN and so do SAAA and IAAA. They are only able to support USD denominated ETFs i.e. VWRD and IAAA.

    Also if I could bother you with another burning question. In future if there are ‘better ETFs’ launched in the market, what does one do? Do we stick to the initial choices or do we switch?
    I am planning to gift a few copies of your recent book to some good friends.

    Thanks again.


    • Hi JB,

      As I mentioned in my book, on page 201, there will always be new ETFs on the market. And the ones you own will also get better because they will reduce their costs over time (if history is an indicator). Switching will cost more in commissions than you will save with expenses. That said, if commissions get couple with currency costs (say you get paid in pounds and Saxo offers an ETF in pounds) then that would be worth switching for.


  71. Shane says:


    I am also familiar with this limitation from Saxo. In my case, I wanted to buy VUSD from the London Stock Exchange (it’s Vanguard Europe’s USD-denominated S&P 500 ETF). But Saxo only offer VUSA (GBP-denominated). When I raised a ticket, the answer was the same as yours: The ISIN number is the same so Saxo can only offer it in one currency from the same exchange. Not good enough! If more people raise a complaint about this, Saxo may eventually get around to making their software more flexible.

  72. Raghu says:

    Hi Andrew-

    You suggested in your book that before using Interactive Brokers, one should check with a tax accountant about US estate tax. Reading some of the above posts between yourself and Wayne potentially seemed to indicate it may be ok to use if trading in a non US exchange? The fee structure of IB is really attractive, nonetheless I value my peace of mind 🙂 Just was hoping to confirm please the latest consensus on this broker and estate tax risk.

    Thanks Andrew,

    • It’s up to you Raghu. What’s your tolerance for the slightly higher risk? Consider what you might gain, and what it might cost you. The decision should be a personal one. Personally, I always want to be cautious. You might be OK with Interactive Brokers. But I have kept my money elsewhere.

  73. Gwynster says:


    I have ordered your book and extensively watched all your online interviews and read your blogs. I have been into an FP for 6 years and am down on my investment- by several thousands- no doubt in part to a significant fee drag!! as well as facing a several thousand pound surender fee!!
    Thanks to reading your blogs I have figured out a way to get out with minimum damage- I think….

    My question:
    I am on the verge of getting a Saxo account. I am British but my wife is Australian. We have real estate in Aus and we are looking to buy in the UK to, so we have a “foot in both camps” as were.
    If anything we are leaning toward Australia for the future, but who knows.
    In terms of investing their tax laws are much less forgiving than the UK for expats:(

    So would we be better off with a TD International account or a Saxo Account. Also do Saxo still represent good value in terms of fees when their holding fee is now 5 Euros or equilant per month minimum.
    We are good to go so any advice appreciated.

  74. Sean says:


    I just opened an account with DBS Vickers (Australian Expat living in Singapore), The only option to access the Australian market is via Phone orders incurring a 1% (Min $120) Commission fee.

    This seems expensive compared to purchasing similar ETFs from the TSX (Minimum CAD29 or 0.50% of trading)

    My question is should I purchase through the Australian market and take the hit on higher commission or go through the TSX?



  75. Craig says:

    Good afternoon,

    I have your book, offshore trading account, and I am a Canadian non-res. I have held Vanguard S&P 500 (VOO) in the past. If I buy something similar on the Canadian TSX I will pay 15% withholding tax. I would like to know if I find a similar EFT on the London exchange will I pay less tax? (trying to avoid withholding tax). I am looking for the most similar fund to VOO outside the USA preferably still with Vangaurd.

    Many thanks

  76. Hazem says:

    Dear Andrew,

    I wanted to understand . I live In Dubai non us citizen and opened account with IB USA. I will either buy candian ETF exposed to US markets or Ireland domiciled ETF from London exchange. Since I buy through US broker Am I eligible for US estate TAX ( after 60K) although the ETFs will be non us domiciled ?

    • Hazem, there is a possibility of that, yes. You would not be liable, but your heirs might be.

      • Hazem says:

        Dear Andrew,

        So what Shall I do? I don’t know where to have good broker except in US. There is Saxo bank here in Dubai but transaction costs 15$.

        Any good international cheap broker ?

        • None are as cheap as they are in the U.S. or Canada. But commissions on brokerage purchases are small potatoes, in the grand scheme of things.

        • Mohamed says:

          Hi Hazem,
          I have gone through the same dilemma, in my opinion it depends on how frequent you plan to do your purchases…
          eventually as Andrew says, it is all small potatoes…

          • Hazem says:

            I have checked the US estate Tax laws and got confirmation that If you use a US broker to buy non-US domiciled ETF it will be considered non US situs and will not suffer estate Tax even if Above 60K however the Cash in the US broker account will be.


            “Because stock of a foreign corporation is not subject to U.S. estate tax, holding U.S. situs assets through a foreign corporation constitutes a planning opportunity.” Units of an Ireland domiciled ETF are ‘stock of a foreign corporation’, and this insulates you from US estate taxes on it, no matter what it holds internally. Importantly, here you do not own the S&P 500 shares; you own shares in the ETF, and the ETF is what owns the S&P 500 shares. Basic insulation of yourself from the US by adding an intermediate non-US holding company.

            Also from the same document: “In IRS Letter Ruling 9748004, IRS applied … rule to impose estate tax on a U.S.
            mutual fund organized as a corporation, even though the mutual fund invested solely in foreign securities.” So a US domiciled ETF that may contain only non-US stock is at risk from US estate tax. And the US cannot have it both ways.

            Posts: 764
            Joined: Tue Jun 05, 2007 2:19 am

          • Guillaume says:

            Hi, Mohamed, Hazem,

            I live in Dubai too, and have an IB account and a TD international account.

            I will trade stocks in the IB account, limiting US ones to $60k and but will look to place ETFs in the TD international account after reading this blog.

            Just like Andrew puts it, I don’t want to take the slightest chance that my heirs have to go through that sort of problems.

            If it’s a longer sickness or old age, all this would have been transferred away from the US and US stocks sold to avoid any issues for my heirs.

            This really is only a problem if you die of a sudden death…
            It’s a big problem though. My father died at 54…it can happen…

  77. Hkcanuck says:

    It appears TD International has reduced it’s fees significantly since the latest book was published. Looks like euro 15 per trade and no more .20 account maintenance fee. That would make it a more cost efficient broker than DBS or Saxo, methinks.

    Any thoughts?


    • Hazem says:

      Best to Go with IB and buy non US domiciled ETFs it will cost half on transactions

      • Hazem,

        I, for one, don’t have the courage to invest with Interactive Brokers. Some of my other readers may be “wimps” as well. I would rather be 100% sure that the U.S. government can’t hammer my heirs with U.S. estate taxes when I go off to my ultimate reward. And IB keeps its funds domiciled in a U.S. account, even if the ETFs are purchased off a non-U.S. exchange. I’m not saying that your heirs will be hammered by U.S. estate taxes. In fact, they probably won’t be. But personally, if there’s even a 0.5% chance of that likelihood, I won’t pinch pennies in the commission department. That’s just me. And granted, I am an investment wimp. Guilty as charged.


    • Hkcanuck,

      For those living outside of Singapore, it certainly would be cheaper to invest with TD Direct International, now that they have reduced their fees. Those living in Singapore, however, would have to pay to have their money wired to the Luxembourg based account.

      Thanks for sharing the link with everyone.


    • caleb says:

      Agreed. Internaxx (TD International) looks to be a good option and has strong parentage in Toronto Dominion Bank. CG

  78. alain says:

    Hi Andrew

    I have read both of your books and I’ve being trading for the last two years following your advices. I have simple portfolio of Vanguard products and some swap based ETF’s and fundamental index just to “see”.

    On the topic of avoiding US estate taxes. I have read your suggestions in going from DBS to Saxo etc. Being too lazy to do it, I just conclude this: I have bought most of my US based ETF’s (over 250K) at a time when CDN was almost to parity with the USD. When i sold my USD ETF’s, CDN was down almost 20% (1 to 78,54). So I went ahead and bought CDN using DBS exchange rate and ended up paying 2% for it. But I think this was still a good move. With the same money, I am buying 20% more CDN based products. what you think?

    My last comment is about your second published book. It complements very well the first one, although it wasn’t as shocking to me. I was a disciplined investor. Zurich, DeVere, Friends Provident and Generali all got me for years, am not joking, all of them until i read your book. Now this part is over after loosing a lot, but it’s not time to look back. As a matter of fact, looking forward in the future, that is the part missing for me in your last book. Thinking of retiring in 5 years, there are so many questions. For exemple: how do you keep your account in DBS singapore? how do you live on 4% per year? you take all of the 4% once at the begining of year or you set up monthly? twice a year? What do you sell? where do you send this money? or using a credit card linked to DBS singapore? What if i plan on travelling the world on a boat? I won’t have a residency status anywhere? does that matters?
    I don’t want to go on, but basically the part missing for me is what happen after THE day when you take off as you did for Mexico.
    Or this might just be your third book: Global expatriate’s guide to retired living, from millionaire expats to millionaire retiree
    Still recommending your book and bought a few to friends and family, to a point they think I have some dividend from the sale of it.

    yours truly

    • Hi Alain,

      To answer your question about the currency movement, it’s a wash, unfortunately. Let’s assume you have a S&P 500 index trading in U.S. dollars on the New York exchange. Let’s assume that the index gains 0% in U.S. dollars. Now, if you sold that ETF, and traded it for a S&P 500 trading on the Canadian market, the price of the index would now be 20% higher if (as in the case you gave) the Canadian dollar had fallen 20%, compared to the U.S. dollar. When you trade one diversified portfolio for another, currency differences will neither give you a real profit or a real loss, if you are indeed buying the same portfolio…but on a different exchange,.

      As for your other question:

      I don’t know where you are from. Let’s assume you are Canadian. If you repatriate to Canada, you will have to sell everything (closing your offshore brokerage account). You would then transfer the cash to Canada, and open a local brokerage there. At this point, you would buy the same ETFs you had owned previously.

      When it comes to selling 4%, you would do this at the beginning of the year. Then you would put the money in a money market fund or accessible savings account for your expenses for the year.

      In terms of what you sell. You would think the same way that you would while acquiring assets….but flip it. Let’s assume your goal allocation is 50% bonds, 50% stocks. If, at the end of the year, your stocks now comprise more than 50% of your total, that means you will have to sell more bonds than stocks that year, to ensure that your portfolio maintains its goal allocation. That’s it. Easy peasy.


      • alain says:

        Thanks Andrew for your reply
        In fact, as I pressed SEND, i figured out the first part of your answer. Oh well, at least it didn’t go into buying my advisor a part of his mercedes!
        I am Canadian and will remain non resident for as long as i can.
        Thanks for your second answer. Now i need to figure out what is a money market fund or accessible savings account! And how not having a residency address can affect this.
        As for what you sell, I totally get it and it makes sense of course!

        • Hi Alain,

          You won’t have a residency? Are you planning to sail around the world for many years? If that’s the case, you can keep your offshore account open until you decide to repatriate to your home country. And if you don’t repatriate to your home country, preferring a country like Thailand, Malaysia, China etc., you could keep that offshore account open. A money market account is just a bank account that pays slightly higher interest than a regular bank savings account would.


      • Lee says:

        Dear Andrew,
        Thank you so much for your extremely useful books and website.
        Can I ask here why, when finally repatriating to our home country, we need to sell everything and close the offshore brokerage account? Is it not possible to keep the offshore account open and avoid the fees associated with closing and moving the account?
        Is this recommendation specific to Canadians? I am a New Zealand expat in the Middle East so I would be interested to know if I would also need to sell and close the offshore account.
        Many thanks,

  79. starch0 says:

    Dear Andrew,

    Thank you for both your very informative books. I’m a Singaporean who spent more than a decade in the US before returning to local shores. I own several Vanguard ETFs, but am concerned not just about estate tax duties, but about capital gains taxes.

    1. As a Singaporean with US-domiciled ETFs – do I have to pay capital gains taxes when I sell my funds?

    2. I came across a rumor that I have been unable to verify – that FATCA will impose a tax on gross sale proceeds (ie: if selling $10000 of a fund I purchased for $7000, I would be taxed 30% on the $10K not just the $3K). This makes no sense to me. Would you know anything about this?

    Thanks and best,

    • Starcho,

      If your money is held in a Singapore brokerage, you will not pay capital gains taxes on it, even if the ETFs are U.S. products. If, however, you opened your account while in the U.S., that’s a different story. You would pay taxes to sell in a taxable account.


  80. Mindy says:

    Hi Andrew,

    I read your book and now I have clearer view on investing and retirement plan.
    Here’s a quick question: I am a Korean and my husband is American and we live in Singapore for the past 5 years.
    We are thinking to retire either in South Korea or Singapore with some possibility in USA.
    I have an OCBC securities account where I can access to SG, HK, and USA markets.
    Would it be wise to buy them myself to avoid current & future taxes?
    Is there any benefit for my husband to purchase them rather than me?
    Thank you for your help in advance!


    P.S. oh and is there anything to consider choosing between Vanguard or Schwab products from Singapore?

    • Hi Mindy,

      To the best of my knowledge, all of the Schwab ETFs are U.S. domiciled. If you, personally, want an account that’s virtually tax free (with no risk of an estate tax hit) then you won’t want a Schwab ETF. Your money should be in your name, outside of the U.S.A. For maximum safety, that also means any Vanguard ETFs that ARE NOT domiciled in the U.S. Instead, consider the models in my book. None of those (listed for non-Americans) are U.S. domiciled.

      I’m not suggesting, however, that your husband funnel his personal money into your name in an offshore account. To stay within the IRS tax laws, he would need to invest in different products. You can see guidelines of what he could buy in my book’s section for Americans.



  81. Bren says:

    Hi Andrew

    I recently opened a TD International Account and made my first purchase of ETFs from the TSE. One thing I’m concerned/curious about is the exchange rate. My money was in USD, but buying on the TSE put my stocks into CAD shortly before the CAD took a nose dive.

    I understand that this is a long term (25 years for me) process, but how does a slumping currency affect investments if they are S&P 500 ETFs or Emerging Markets ETFs? If the S&P stays constant and the CAD drops, will the value of my ETFs rise (in CAD terms) to stay constant?

    • Bren,

      The value of your index has nothing to do with the currency it’s denominated in, and everything to do with the underlying value and currency of the stocks within it. Here’s an example.

      Assume the S&P 500 (this is a U.S. index) gains nothing in 2016.
      Assume you bought a S&P 500 index trading on a Canadian exchange in January 2016.
      Assume that the Canadian dollar drops 50%, relative to the U.S. dollar, the day after you make your purchase in January 2016.
      Your S&P 500 index will have soared in 2016 on the Toronto stock exchange, because the Canadian dollar movement doesn’t affect the underlying value of the equities in the S&P 500. Even though the U.S. market went nowhere, in this scenario, when your personal profits are measured in CDN, you would have gained a significant amount of money. Measured in USD, you would have made nothing. Yet…convert it to Canadian, and you would see a huge profit.

      Here’s another way to look at it. Imagine buying a U.S. index in 2017 in Canadian dollars. Your Canadian dollar drops 99% over the next year. Your index would then reflect that, and in Canadian dollar terms, would have gained a tremendous sum….because it isn’t invested in Canadian dollars at all. An index (no matter what currency you buy it in) is worth what the underlying value of the equities are worth…in their currency, not yours.


  82. Alan says:

    Hi Andrew,

    I’ve read your book and scrolled through various pages of your blog. All great stuff here, but quite overwhelming for a first time investor. At the end of the day, what would you recommend? I’m a non-resident Brit with bank accounts in both HK and Singapore. I have residency rights in HK (never worked here though), but I am currently living and teaching in Singapore. Should I open a DBS Vickers in Singapore or HK? Or with Saxo? Does it really matter? I do plan on spending some time in HK during my retirement years. Would appreciate your help in simplifying things to get me started.


  83. Andrew says:

    Hi Andrew,

    As an Australian ex-pat in Japan I have been hunting for a way to purchase a portfolio of index funds. In your article you mention ‘TD International’ as an option to gain access to our home market, although my application was denied today. It looks like they don’t allow accounts from Japan anymore.

    Does this leave only Saxo bank? Perhaps DBS? It seems like lots of people in the comments have been having some difficulties opening accounts with DBS.

    • Andy says:

      I have a similar issue. Also an Australian expat. TD won’t open an account for me as an Australian resident (if I say I’m living in Australia), an expat resident in my current location (Vietnam), nor will they open an account in my next location (Cambodia). It seems TD are a lot more restrictive now compared to what they were when Andrew must have been researching his book.

      You won’t be able to open a DBS account as it will open you up to the Estate taxes that this article is about because DBS doesn’t have direct access to the Australian market. I opened a DBS account with the intention of buying into Australia via the New York stock exchange, but now can’t because of this Estate Tax issue.

      I think my last resort will be Saxo, unless there’s another option out there now….?

      There’s also Vanguard Australia, however they cannot/will not open accounts for AU citizens who are non-residents. Though I’m assuming one could open an account with them by claiming to be a resident instead of an expat, much like the advice in the new book for US expats. I’m not sure what the tax implications of this would be though in Australia considering I’m a non-resident for tax purposes. I’m assuming I would have to put in a tax return.

      • Andy,

        You could still use DBS Vickers. Just build a global portfolio with up to (and no more than) $60,000 USD in a U.S. domiciled Australian stock market index. And go global with the bonds. You could buy off the Canadian exchange for everything except the Aussie index.

      • Fortunately, Andy, what I wrote about TD Direct International is still up to date:

        “Some investors, however, aren’t eligible to open accounts with TD Direct International. Expats living in Japan and Bangladesh are two such examples. Those living in Indonesia are also scratched from the party list.

        One British investor currently residing in Indonesia contacted me recently in disappointment. “I was a client at TD International for five years, but they sent me an apologetic letter stating that Indonesian residents can no longer use their brokerage.” Such restrictions sometimes relate to whether the brokerage feels it can trust the identity of the account holder.”

        Saxo may also have similar restrictions, although they aren’t as picky. If you’re living Japan, Saxo says no.

        And opening an account with DBS Vickers is a bit like opening a bank account in Thailand. You could approach the same bank ten different times. Five of those times, they’ll let you open an account. Five of those times, they won’t.

        I did get a quote from upper management at DBS Vickers (with a name) suggesting that virtually any non-American expat can invest with them. If you have trouble with that, try dropping that name and reading the quote.

        Good luck,


  84. Lili says:

    Hi Andrew,

    I have been reading your blog over the past couple of days. I want to thank you for providing so much useful information.

    There is a lot of information regarding avoiding estate tax and brokerage fees, but I was wondering if you have considered brokerage insurance (the equivalent CPIF in Canada and SIPC in the US)? Does Singapore have any investor protection against brokerage failures? I would think this would be a consideration especially since all stocks purchased would be held in custody by the brokerage firm (in the case of DBS Vickers and TD International).


    • Hi Lili,

      In Singapore, the investments are actually held by the central depository, not the brokerages. The central depository is a government arm. I’m sure there is still risk. I am unaware of insurance in Singapore to protect investors against this.


      • Lili says:

        Hi Andrew,

        From what I understand, the Central Depository (CDP) only holds shares traded on the SGX. Shares traded on other exchanges are held in custody by the brokerage firm, hence the monthly custodian fees for trading Canadian stocks ($2 per month per counter “Custody Fee” for DBS Vickers). Unless I’m missing something?

  85. Michael Port says:

    Hi Andrew,

    I’ve also read and enjoyed both of your books, and have recommended them to several fellow expat friends.

    We are an expat couple living in Hong Kong, and my wife is a Japanese national. I’ve read through all the posts and elsewhere on the web but have not been able to find advice specific to this situation: Recommended exchange(s) for Japanese expats looking to purchase world index funds (both traditional and fundamental) via a Hong Kong brokerage. Obviously, the US is out due to estate tax issues, but what domicile is best eg UK, Canada, Lux. Boom Securities (acquired by Monex in Japan) and Saxo Hong Kong both offer stock trading across in HK and overseas markets, with the latter offering a much larger range (incl US and Canada). There is also the longer term concern of repatriating to Japan at some point and the relatively high estate taxes on the Japan side, as well as the new exit tax that is most likely going to be introduced in July of 15, but those factors aside, which exchange(s) would you recommend for Japanese expats in Hong Kong?

    Any feedback from you or your readers much appreciated.


  86. Guillaume says:

    Hello again,

    I still have my UK SIPP and plan to trade stocks and insert funds in it.

    Now what if one puts US stocks in the SIPP ? Because the SIPP is a pension, with a trustee in the UK. Does it not qualify in a way as being a foreign company holding the US shares (like the Ireland Domiciled ETFs ?)…

    Would that not be the best way to hold US shares for us ? In a SIPP or also in a non US domiciled Trust, like in a Jersey one ?


  87. Ali says:

    Hi Andrew:

    when adhering to your recommended portfolio, does it make a difference if one invests in a short-term bond ETF or long-term bond ETF? For instance, would you recommend (Vanguard Canada) VSB or VAB or it does not matter?


  88. Maureen says:

    Hi Andrew, expat Canadian, just read your book….exactly the kind of information I needed. Thank you. I sent all my paperwork to TD Direct Investing in Luxembourg. They told me everything looked fine, but if I ever repatriated to Canada I would not be allowed to hold an account in Luxembourg. Is this actually true and if so, do you know the reason? The rep was vague. Thanks.

    • Maureen,

      Resident Canadians must pay capital gains taxes. Once you repatriate, you will have to close this account (or at least, you should). Not doing so would be considered tax evasion because Luxembourg has no capital gains tax laws.


  89. Fred says:

    Hi Andrew, I would love you to clarify a specific point. Does withholding tax depend on ETF domiciliation or where the ETF is listed? For example, you can buy SWDA (which is domiciled in Ireland) from various stock markets. Will the withholding tax of Ireland apply to SWDA / IWDA irrelevant of where we buy the ETF?
    I am trying to find ways of paying as little withholding tax as possible. Thanks for your help.

  90. Fred says:

    Thanks for your reply Andrew. Don’t you think there are more risks attached to this type of ETFS, since they are not holding the actual stocks? Since Swap based ETFs don’t attract withholding tax, why don’t most people trying to capitalise (for retirement for example) opt for this type of product?

  91. Charlie says:

    Hi Andrew,

    I hope you are doing well. You’ve given me plenty advice in the past and I thank you for that. I now hold a Saxo account with VWRD and IGLO and have around 100k Invested.

    I am a South African living in the Middle East and I have just opened a TD Direct account. My plan is to try a different portfolio in this account. Something I don’t understand though. If I never plan on returning to South Africa, can I basically pick any strategy from any nationality out of your book?

    Presently I don’t hold any funds from my home country. I was thinking of following the Fundemental Index for Canadians or even buying the Horizon ETF’s you suggested. Am I missing something here?

    Much appreciated as always,

    • Charlie,

      If you don’t plan to ever go back to South Africa, you won’t need a South African stock index. Going with something global might be best, if you don’t know where you’ll eventually end up.


  92. Vig says:

    Hi Folks,
    I was wondering if any of you have 2 different investment accounts in 2 different currencies at the same brokerage? Does it make sense to do this? I’m not sure in which country I’ll be living in 30 years. I’m Canadian.
    Anyhow, I’ve already got a CAD denominated account. I was thinking of opening a USD denominated one. The ETFs I would buy would be more or less the same as what’s in my CAD account, a nice mixed 60/40 split of equities and bonds. So in total, I’d have 7 or 8 ETFs spread across a CAD and a USD account. I buy via TSE only.
    Anyone recommend having 2 different currency accounts? (Honestly, with the low CAD I’m tempted to plow American dollars into the ETFs in my CAD account…)
    Thanks ; )

    • Vig,

      This would be redundant. Always remember that when you buy a U.S. index, denominated in Canadian dollars on a Canadian brokerage account platform, you are really betting on the U.S. dollar, not the Canadian dollar. I wrote about this in my expat book.


  93. Vig Lacera says:

    Thanks for replying, Andrew. I’ve since re-read your Expatriates’ Guide book b/c obviously some of the concepts haven’t stuck ; )

  94. Martin says:

    So I’ve been looking around for the perfect ‘all world’ ETF for Singapore-based investors trading via Standard Chartered (which cannot access Toronto exchange) and my conclusion is that it doesn’t exist. What I’m looking for is something that’s ~50% US and ~50% rest-of-world. There’s plenty of great products out there but:

    1) Australia has relatively high fees and 30% dividend tax
    2) There’s nothing suitable on SGX (and it tends to be expensive, fee-wise)
    3) HK has a Vanguard S&P 500 EFT but nothing ‘all-world’
    4) London has a good product (VWRL) but 20% dividend tax + estate tax + stamp duty upfront
    5) U.S. has plenty of good products but estate tax + 15% dividend tax (IIRC)

    So unless I’m missing something (am I?), there’s not a clear winner. I know I could use DBSV (and thus access Toronto) but for simplicity sake I prefer to do it all via SC. And even then, VXC.TO still attracts 15% dividend tax.

    Best option seems to be the S&P 500 from HK (3140.HK) plus others to build out the ‘all world’ (ex-US) exposure – but then it starts getting messy with so many smaller allocations across multiple funds.

    I’d love to get some thoughts on all this.

  95. Justin says:

    Hi Andrew,
    I am a Canadian living in Europe (we met in Bali last spring). I have my investment with DBS Vickers and want to put out a question to your readership. I recently asked DBS Vickers what would happen to my money in the event of my demise. Here is what they said:

    “As your account is not a joint account, In the event of your demise your account can be operated by a legal appointed executor whom can proceed to liquidate your holdings and withdraw the funds. ”

    This is a big concern. If I die in a car crash tomorrow, my family won’t see a penny of my life savings. DBS will retain the funds. I don’t currently have a legally appointed executor at this point and wanted to ask around if anyone else investing in this community has any recommendations. Its trickier still, as I am Canadian, my wife is Japanese, DBS is in Singapore and I live in Europe. Does anyone have any suggestions for me in terms of hiring the services of a (reasonably priced and trustworthy) legally appointed executor who could negotiate my ‘international context’?


    • Justin,

      You interpreted that unusually. To “liquidate holdings” means they will sell them…that doesn’t mean they will keep that money. To sell is to put the money into cash. They won’t keep that money. The cash would then be legally distributed in accordance with your legally binding will, which I assume you have.


      • Justin says:

        Hi Andrew, sorry let me clarify what I meant. I do understand what liquidate means. My concern is in relation to the fact that I don’t in fact have a will, and as such, my wife and children would be unable to access my holdings with DBS vickers. DBS vickers would effectively keep my money in the event of my demise. I recently spoke with one solicitor in the UK in the hopes of having a will drawn up. She told me that, as my assets are in Singapore and outside of her firm’s jurisdiction, she would be unable to execute our will. So the question I have is, can anybody recommend a solicitor / firm that is confident it can execute a will that involves
        Singaporean assets from overseas? Thanks Andrew,

        • Justin,

          Do you really think that DBS would keep your money if you died? That would most certainly not be the case. If that were the case, it would be a major source of revenue for such brokerages 🙂

          To rest easy, you may want to have a will drawn up in Singapore.

        • Justin,

          I just called DBS Vickers on your behalf. If the woman I spoke to, Brenda Khoo, weren’t Singaporean, she probably would have laughed at me when I asked the question about whether the bank can keep an investor’s assets after they pass away. The answer, of course, is no. The bank has no right to those assets. The assets belong to the deceased…and his or her heirs, as legally documented in a will. Even if there is no will, there is no way the bank has a legal right to that money. It simply doesn’t belong to them.


  96. Justin says:

    Hi Andrew,
    I guess my primary concern is whether my wife and kids will have a legal right to the money & the ability to execute from abroad. Anyway, I wanted to thank you for your reply and your extra efforts on this one. Cheers Andrew!

  97. Ivar says:

    Great post Andrew. One question: You say that dividend withholding taxes of 15% would be taken at source if you have an account with TD for example and are non-resident. I just spoke to the help line at Questrade and they told me I can continue to keep my margin account open after I leave Canada, add new money to the account, and pay no withholding taxes when I withdraw. So if I retire to Ecuador one day as planned, why not just keep my investments with Questrade? Cheers.

    • Hi Ivar,

      Nobody ever pays withholding taxes when they withdraw, no matter what the account is. These are dividend taxes, taken at source, once per quarter. You will pay those with Questrade. There’s no way around that, unless you buy the Swap Based products that I mentioned in my book. Here’s link: http://bit.ly/globalexpat

  98. Ivar says:

    Thanks for the clarification on dividends Andrew. I have your excellent book and am looking into the swap-based products you mentioned. To close the loop re: Questrade, I just received an email from their support desk saying that I would not be able to keep my margin account open if I were to move to Ecuador. When I had spoken to the help line earlier, the agent didn’t ask which country, so it seems to depend on where you’re expatriating to.


  99. MS says:

    Andrew – truly a great website. Thank you.

    My wife and I are Canadians but residents of the US (paying tax in the US). We have $200K in cash in Canadian dollars in Canada ready to deploy. Buying HXT and HXS vs any other ETF seems like a no-brainer.

    SO…how else can I minimize taxes?
    1. I’ve been told by my accountant to get this classified as a “Qualified Electing Fund”. True? How would I do that?
    2. If I opened an account in Singapore for my Canadian $ and buy HXT/HXS, would that help me avoid US taxes?

    Many thanks,


  100. Alexander says:

    Hi Andrew,

    Thanks for all this amazing information! I have finished reading your book and had a few questions…

    Given that its written a while ago now, I assume the info is a little out of date. I see you suggest VUKE still, and VWRL (as opposed to USD equivalent VWRD). However in the book you suggest iShares IGLS for bonds but here you suggest VGOV, which looks cheaper at 0.12% than the iShares 0.2% IGLS. I assume it is safe to invest all in one set of stock? I worry about if vanguard go bust does that mean I lose everything? All eggs, one basket kind of thing 🙂

    Also I intend to use interactive brokers, and I think using the LSE Vanguard stocks exempts me from US Estate taxes, can you confirm if this is the case?

    Thanks so much, I love your work 🙂


    • Hi Alexander,

      The book isn’t yet out of date…yikes, I just wrote it 🙂

      Vanguard won’t go bankrupt. And new ETFs are floated all the time. The currency that they are listed in is relevant only if you are paid in currency A and a fund trades in currency A. In that case, you won’t pay currency exchange spreads to buy it. If you are paid in currency C and the funds have a currency A or B option, flip a coin. You will end up getting the same overall return, if you converted the money to a third currency at a later date.


      • Alexander says:

        Hi Andrew,

        Ah yes, sorry, I think I was thinking of your other book 🙂

        Thanks so much for the help, it is much appreciated! I will probably go for a complete Vanguard portfolio then of VUKE, VWRL and VGOV as they all are pretty cheap and Vanguard seem to be pretty reputable as a company.


  101. Raven says:

    Hi Andrew,

    With regards to your post, about the U.S. estate tax laws, as a non-american (singaporean) living in singapore, which world index should i buy? I am thinking of buying one which only consist on the US stocks and one that consist of mostl developed countries. What do you think and advice on the index which i should buy?


  102. jcgsing13 says:

    Raven_ IWDA.L which is MSCI World UCITS ETF is one I use. Weighting for USA is just over 59%. Dividends accumulate. London listing hence no USA estate tax concern. Keep an eye on UK estate taxes, check with pros but I think 145k GBP equiv. is their threshold versus $60k in USA. MER for IWDA.L is 0.20%. iShares product. Liquid.

  103. jcgsing13 says:

    typo there MSCI World UCITS ETF, IWDA.L

  104. Ben says:

    On Assetbuilder, you once recommended several London Exchange Traded funds (for avoiding US Estate Tax). One of these was a Vanguard S&P 500 ETF…

    The sheet seems to indicate that VUSA is purchased using GBP, and VUSD is purchased using USD, yet both on the London Exchange. My broker, however, is telling me that one may only purchase securities using the local currency of the Exchange, and that both of these are purchased using GBP. Is this true?

  105. PKDVW says:

    Hi Andrew,
    Great books, thanks. I am and Australian living and working in Singapore using SAXO, who will be retiring in Australia. You mentioned Vanguard U.S. Total Market Shares Index ETF (VTS) trading on the ASX for Aussies. In the product information for the ETF its mentioned that its domiciled in the US.
    I am not sure if I should be investing in this etf in regards to taxes in the US.
    Any insight would be most appreciated.

    • If it trades on the Australian market, you’re fine, even if it’s a U.S. stock market ETF. Where it trades (as an ETF) is the point to consider. You’re safe with this one.


  106. pkdvw says:

    Cheers Mate, much appreciated.


  107. Jonathan Iliffe says:

    Hello Again Andrew,
    Some of us Canadian teachers are going to open Saxo accounts this Monday. We thank you for all of your advice. I am also happy to report that Saxo has gotten rid of the inactive trading fees. However, there is one thing I am still struggling with:
    I am paid in USD. I have an equal sum of savings in both USD and CAD. I will most likely retire abroad.
    Am I better off opening a USD or CAD Saxo trading account? Does it matter? I was planning to open a CAD account with Saxo and go with VUN, VDU and VSB. Does this make sense to do if I do not plan to retire in Canada?
    I know you have explained this many times but I still can’t seem to grasp it. Mainly because I imagine myself needing to convert all the CAD from my portfolio into USD down the road (more accepted global currency) and potentially losing out to exchange rates like we have now.

  108. Vijay Pothapragada says:

    Hi Andrew, I am glad to have come across your site (better late than never). I am an expat (US NRA) investor planning to invest in ETFs tracking S&P 500. After reading the information on US estate taxes, I decided to invest in ETFs listed in stock exchanges outside US. I have been considering investing in ETFs S27 or D07 on SGX. I am concerned that even though S27 or D07 are listed on SGX, these ETFs are domiciled in US and would result in estate tax issues in case of my demise. Is my understanding correct? Thanks, Vijay

  109. Riccardo says:

    Hey Andrew,
    I just read your Expatriate’s Guide and am super motivated to get started. However, there’s something that left me confused. I’m German, currently living in the UK. I totally understand that I shouldn’t get any U.S.-domiciled ETFs to avoid the U.S. estate taxes my family back in Germany would suffer in case of my death. Here’s the hook though: I wanted to create an account at TD Direct International and noticed they don’t accept U.S. citizens or residents. I’m actually moving to the States next year and will probably be there for a few years. I will definitely come back to Europe though. What options do I have in terms of choosing a brokerage at this point? It’ll be 3-4 months before I move. Can I open the account now and keep it? Or do I have to wait and have no other choice than opening an account with a U.S. brokerage once I live there? Thanks, Riccardo

    • Riccardo,

      You could open the account with TD Direct International now. But if you file your U.S. taxes properly, you would have to declare any gains you make with the IRS. The tax rate would be higher than with a Vanguard based resident’s account within the United States itself. The IRS treats offshore accounts less leniently, when it comes to their capital gains tax rules.


      • Riccardo says:

        Thanks Andrew, that is good to know. Going to make some research to fully understand the differences in tax rates. What is your recommendation in this case?

      • Riccardo says:

        TD just told me they would need to close my account when I move to the US, meaning I’m not able to use any of the international brokerages mentioned in the book/this article or any other company I researched.

        Sounds like I need to wait until I’m in the US and open an account with a US brokerage and then move all my investments once I leave the US. I’m obviously a little disappointed right now, but I’m wondering if that is all bad? Are there any good sides or opportunities about this?

        Generally it turns out to be incredibly hard to find any information or tips for non-US expats moving and working in the US for some period. Did I miss anything in your book or website? It seems to be a specific case that is nowhere mentioned (although pretty common I’d assume). Are you aware of other sources to inform myself?


        • Riccardo,

          If you would like to keep that account open, don’t try to change your address (to a U.S. one). Give TD a friend’s address offshore. You could theoretically just leave the account where it is. Once you move to the U.S., however, you are under their taxation laws. There’s no way around that. If you want to invest, you will have to do so with a U.S. brokerage once you move there. Fortunately, you will have Vanguard. But you will want to close that account when you leave. You’ll have to pay some capital gains taxes, upon leaving (if you have made money) but it shouldn’t be that bad.


  110. Rohit says:

    Dear Andrew

    Thanks for all the knowledge. Amazing work. I am an Indian living in Malaysia and a regular investor in mutual funds in India . Now I am looking to diversify into USA market and would like to start with ETFs. Post reading lot of docs on expats investing in USA, I have chosen my fund but have a set of specific queries- would be very helpful if you could assist in answering them:

    (1) To avoid Estate Tax and withholding tax- I have chosen VWRL/VWRD. I am looking to open an account with TD Ameritrade but couldn’t find VWRL/VWRD in a general search in their website. Could you advice if they offer this particular fund? and are they commission free?

    (2) I have limited USD which I want to invest (not keen on converting currencies)- hence wanna chose a broker who is not fussy about locking in USD and then invest incremental dollars in ETFs- have chosen TD Ameritrade- any other brokerage you can recommend?

    (3) Estate Taxes
    (a) If being an expat, I invest in USA ETFs and give my login id/password to my kin- even post my death- my kin can access my portfolio and take it out- there is no need to let anyone know about my death or get entagled in estate taxes- how technically is this true?
    (b) What is nature of estate taxes or method of a claiming money post an investor’s death in case of investments in VWRL/VWRD? Considering I want to give minimal pain to my kin to claim my money with minimal travel or efforts

    (4) Witholding taxes- In India, we have two kind of mutual funds- one is Dividend paying (NAV gets reduced by that amount) and Growth mutual funds (no dividend). Do US ETFs (VTI, VWRL/VWRD) offer such options? I am looking only for ‘Growth’ kinda ETFs and would be concerned with only capital gains in maybe 20-25 years timeframe.
    (a) If I invest in US ETF and exit after 25 years with capital gains (no death) with total portfolio suppose exceeding USD 100K? Will the capital gains be taxed automatically? Will I have to file in USA and pay capital gains?
    (b) If I invest in VWRL/VWRD- will I be charged capital gains automatically? If I get full money will I have to declare in UK and pay capital gains tax?

  111. inspecteurmancini says:

    HI Andrew, I am a French expat and am considering moving my investment portfolio to a low-fee structure and one of the most interesting option seems to be Interactive brokers. I own US stocks and read about your caution about heavy tax on heirs for non-US citizen. My sons have a US passport since they were born there. Would that inheritance tax still apply then ?

  112. Adam Beck says:

    Hi Andrew,

    As a British expat in the UAE, does it make any difference if I open with the Saxo bank branch in Dubai or in the UK?

    I plan to retire in the UK.



  113. inspecteurmancini says:

    HI Andrew, I believe that now Interactive Broker UK is available. Would it be interesting to invest with them instead of IB US if you are non-US non resident citizen in order to avoid US estate tax? I am wondering what would be the selling/advertising point for IB to open a UK branch if it’s to tell potential non US investors( UK, Europe and elsewhere) that they will be subject to a hefty US estate tax by trading on their IB UK platform ?…

  114. Ian says:

    Hi Andrew,
    Just read your Global Expatriate’s Guide and am stoked to open an account at TD Waterhouse. I’m a non-resident Canadian living and working in China, and figured that would be a good option.
    Went over to TD Canada Trust today to open the account and ran into a few difficulties: First, the guy didn’t really have a clue what I wanted and had never heard of a “non-resident account”. So he starts filling in the usual form and indicates that I am a non-resident and puts down my address in China. Hopefully that’s what is meant to be done. But then he asks me for a “Tax Identification Number”. I have no idea what that is nor where to find it.
    We proceed with the form anyway and he says he’ll send it off but it likely won’t be active until they get that number!
    Another odd thing was that he had me sign a “W-8BEN” form that really didn’t seem to apply to me at all.
    Can you offer an insight/advice here for next steps? Particularly is there a special name for the “non-resident account” at TD Waterhouse that you mention in your book?

    I’m really not sure what’s going to happen with this account application.



    • Hi Ian,

      You’ll need to be careful. Many of the people working at TD in Canada won’t know what you’re talking about, and they might not open the right kind of account for you. As such, you might consider an offshore brokerage instead.


  115. MARK says:

    …..an offshore brokerage like internaxx, which just bought out TD Internstional in Luxembourg. Try to keep it offshore. The tax ID number will come from your Chinese employer.

  116. Ian says:

    Thanks both for your helpful comments. Much appreciated! I think I will check out Internaxx. Will I need to know my Tax ID Number to open the Internaxx account?



  117. Srinivas says:

    Hi Andrew,

    Appreciate if you could help me with my query. I have invested in a few non-US ETFs (UCITS) through a US domiciled broker (Interactive Brokers). Would my account be subject to US Estate Taxes in some way or form? I checked for this information online but haven’t managed to find a clear answer.


    • Mark Zoril says:

      Hello Srivinas. Many of my clients use IB to buy ETF’s Some are American – they buy US domiciled ETF’s. My non American clients buy non-US ETF’s. I am not a tax advisor nor an estate attorney. However, I have researched this and am confident you would not have any estate tax issues using IB. Estate tax issues could be an issue, though, if you have money in cash with IB. If you wanted to completely eliminate even a minute risk of this, you would use another brokerage, but I think that risk is very tiny and not worth worrying about.


  118. Nate says:

    Hi Andrew, I have a question.

    I am planning to invest into a few ETFs via Internaxx on the FTSE (UK Stock Exchange). I am a non resident Canadian expat in Dubai, and have no tax obligations to Canada, and do not plan to return to Canada.

    Would I be subject to any with holding taxes for the UK investments? And also, would I be liable for any estate taxes (like the USA) for my UK ETF portfolio?

    Many thanks!

  119. Nate says:

    Sorry Andrew forgot one other question. For Canadian non residents, would there be capital gain taxes as well for ETFs on the UK stock exchange?

  120. Dave Simpson says:

    If a NRA holds US situs assets at death , his estate would be subjected to estate taxes. These US situs assets could be held at Saxo bank in Singapore … still would technically be subjected to US estate tax .
    On the other hand, if all you hold are foreign ADRs , say in Royal Dutch Shell with your US broker … these would Not be subject to US estate tax.

    The country in which your account is located is totally irrelevant in determining your liability to US estate taxes. Open an IB account or Schwab account in the US without concern , just buy non US stocks,etfs , such as Vanguard UK etfs.

    • Dave,

      I think it’s even safer to use a non U.S. brokerage and buy ETFs off a non-U.S. exchange if you’re a non-American living abroad.


      • Dave says:

        Probably correct, as US brokers must obtain an IRS clearance certificate even if you hold no US assets, i hear this could take 6 or more months.

        PS, thought we could have a kopi one day but seems you are no longer here in Singapore , correct?

  121. Benjamin Pommeraud says:

    Hey Andrew,

    I am struggling with that because even if you invest on the canadian stock exchanges buying ETF following US Stocks, or any american index, you are still subject to the US 30% with-holding tax on dividends. So are you 100% sure that you are not also subject to the Estate Tax?

    • Hi Benjamin,

      If you buy a S&P 500 ETF off the Canadian stock exchange, you will pay a 15% dividend withholding tax and your heirs will not be at risk of having to pay U.S. estate taxes.

      If, on the other hand, you buy a S&P 500 ETF off the U.S. exchange, you will pay a 30% withholding tax on dividends. And your heirs might have to pay U.S. estate taxes. This, of course, applies if you live abroad at the time of death. For more information on how to invest from overseas, you might find my new book useful. Here’s the link: http://amzn.to/2CyIxqG



  122. Renee says:

    Hi Andrew

    I am a Canadian living in Singapore with a DBS Vickers account who plans to buy ETFs on the TSE or SGX.

    Thanks for confirming that if we buy taxes off a non-US exchange, we are not liable for US estate taxes.

    However, I came across an article that seems to suggest ‘cross-listed’ funds, even if available on a non-US exchange (they mention ASX) could still be liable for estate taxes. Here’s the article I read: http://www.etfwatch.com.au/blog/which-etfs-are-cross-listed-and-what-does-it-mean

    But is this only true when they are buying those cross-listed ETFs from a US broker or buying those ETFs directly? I hadn’t read about ‘cross-listed’ ETFs before and never thought of it as a concern (perhaps because I use DBS Vickers).

    Also, I can understand why someone might buy ex-US EFTs (to lessen their exposure to the US market, maybe). But does the ex US part help you to avoid taxes in any way when you are already buying from DBS Vickers off a non-US exchange?

    My friend and I have both read your books but she seems to think she needs to buy all ex US ETFs regardless of which market they are traded on to avoid estate taxes and reading through your comments this doesn’t seem to be the case?


  123. H Gehrig says:


    First off, amazing books, you really nailed it! (I bought Millionaire Expat and Millionaire Teacher). Solidifying the advise of the greats like Graham and Bogle!

    While I’m not a teacher, I am an Canadian expat living in Qatar. I could completely relate to your books! If you have the time, could you comment on the following?

    1 – Why is it that for basically the exact same ETF (as far as I can see), there seems to be a huge difference in expense ratios of Vanguard ETFs listed in American markets vs Canadian markets? ie – VTI in the U.S. vs VUC in Canada.

    2 – What countries’ (markets) ETFs (among others) have you found to have the overall least amount of taxes – most value/possibility for maximum returns? ie – least taxed dividends, capital gains tax etc? Excluding where you plan on retiring, etc.

    3 – Any updates on the best brokers (cheapest, most feature rich) you recommend now? After a lot of research, International Brokers seems very affordable regarding fees.

    Keep up the great work. My sincere thanks for all the time and effort you put into all of this!

    • Hi H Gehrig,

      I’m glad you found Millionaire Expat helpful. I’m on a mission to financially educate expats, and I’ve tried to initiate all kinds of things to do that. In one case, I convinced the publisher to offer Millionaire Expat at 40% off the retail price for bulk orders of 10 copies or more. If you would be interested in helping me help your colleagues (by offering the book to them at 40% off the retail price) please let me know. I can then introduce you to the publisher for a bulk order.

      As for your questions:

      Many years ago, there was a big difference between the expense ratios of Canadian domiciled ETFs and U.S. domiciled ETFs. But that’s no longer the case. When you compare equal and domestic asset classes, you’ll note how close the fees are.

      For example, have a look at relative domestic indexes. An Canadian ETF holding Canadian stocks charges as little as 0.03 percent per year (see Table 12.4 in Millionaire Expat). To my knowledge, no U.S. domiciled stock ETF charges less. Vanguard Canada’s Canadian stock index charges about 0.05 percent. Again, that’s slimmer than the width of a piece of hair on your head.

      If you look at VTI, you’ll note that it costs about 0.04% per year to track the U.S. stock market. Vanguard Canada’s U.S. stock market S&P 500 index ETF charges just 0.08%. The difference in annual costs, between the two, wouldn’t buy you meal each year, for every $10,000 invested.

      But of course, VTI would cost you 30% in dividend withholding taxes, and your heirs would be subject to a U.S. estate tax bill upon your death, so the Canadian domiciled ETF is much cheaper.

      If you look at global stock market ETFs, Vanguard USA offers VT, which costs 0.11%. Vanguard Canada’s global stock market ETF costs about 0.20% per year. That might look like a big difference, but do the math on $10,000 to see how close it is. The difference is based on the financial viability of the assets under management involved. As Vanguard Canada’s global stock index gains more assets under management, its costs will lower. Think of Wal-Mart’s costs, compared to a local convenience store’s. Consider why Wal-Mart can offer goods at a cheaper rate.

      Only about 9 years ago, Vanguard’s USA’s VT cost 0.18%. But as assets under management increased, it was viable for Vanguard to lower its cost. The same thing is happening with Vanguard Canada’s and iShares Canada’s ETFs.

      You also asked me about the most cost efficient and tax efficient portfolio for Canadians? I describe it in Millionaire Expat, pages 276-287. But since the book’s publication in January 2018, a new ETF has become available. As such consider swapping VDU (on Table 12.4, page 277) for Horizon’s new, HXDM. The book explains why this is the most efficient portfolio for Canadians abroad.

      As for your third question, about the comparative costs of international brokerages, I stand by what I wrote in Millionaire Expat. They will all jerk the fees up and down, so it’s a mute point to research. Only IB will have consistent rates. And I note the fractional risks with IB in my book as well, as compared to the other brokerages.

      And, back to the original mission: If you are interested in helping your friends, I could help you facilitate a 10 copy minimum order directly through the publisher at 40% off the book’s retail price.

      Please let me know.



      • H Gehrig says:

        Thank you for the book discount offer, I will most DEFINITELY look into this – to see if there’s any interest. I personally think Millionaire Expat is a must read before heading overseas, I just wish I had stumbled upon it sooner!

        May I be so bold as to ask some more questions after reading your very detailed reply? I’ll assume yes 😉

        1 – As for swap based ETFs, am I correct that the swap fee must be incorporated into the cost of the ETF? As such, the fee is essentially compounding much like the management fee? ie – swap fee 0.3% + management fee 0.1% = 0.4%

        2 – In this blog post, you don’t make any mentions of Interactive Brokers (yet again, someone brings them up!). While the whole point of this blog post is to avoid Estate Taxes, from everything I gather, as long as your securities are non-US based, and you hold less than $60 000 USD in the account at any given time, you should not be liable, correct?

        You must think I have some type of fetish with Interactive Brokers at this point, but from every angle I’ve looked at it, IB seems to be the cheapest broker out there by a subjectively large margin. When considering currency spread/commission when converting funds for a purchase, lack of account fees (above 100k), ultra low purchase fee, when investing around 100 000/year, it comes out to $1000-$4000 in savings when compared to other brokers, even when compared to domestic brokers in Canada.

        The ultimate question is, does the fact IB is based in the U.S., increase the chances of Estate Tax. I dare say no…?

        This question leads me to #3, with emphasis on Interactive Brokers.

        3 – In the blog post waaay above:

        “Expatriate Canadians don’t have to pay capital gains taxes on their stock market investments if they’re held in a friendly tax jurisdiction, such as Hong Kong, Singapore or Luxembourg–and if the investor resides in a jurisdiction that would allow such an account. Canadian non-residents may also be able to open “non resident” brokerage accounts with Toronto-based TD Waterhouse,”

        They way I read it, if the securities are held in a friendly tax jurisdiction (ie – the broker must be based there), capital gains tax does not apply, assuming you are a legal resident of a friendly tax jurisdiction as well, but what if they’re with a non-resident Canadian based broker? You answer that question in the second sentence. However, due to the first sentence, I’m a bit apprehensive in saying it’s clear.

        Let’s put it this way. As long as I am a resident of a friendly tax jurisdiction (in my case, Qatar), I would not pay capital gains tax on Canadian securities (just 15% dividend tax), regardless of where the broker I bought them with is located, is this correct? Ie – If I lived in Qatar (no taxes), but bought from a TD non-resident account (referring to TD based in Canada), or in particular, Interactive Brokers, with either, I would not have to capital gains tax, just dividend tax? Phew! Is this correct?

        In other words yet again, essentially the key here is where you legally are a resident (ie – a tax free country, like Qatar in my case), not where the broker is located in the world?

        I don’t want to dilute the meaning and significance of it by saying it too much, but thank you so much once again to you (and your contributors) for all your endearing hard work and insight. It truly is heartwarming and inspirational!

        • Hi H. Gehrig,

          As a Canadian in Qatar, you would not have to pay capital gains taxes on your gains if you used IB or any of the other brokerages I mentioned, just 15% dividend withholding taxes, if you buy the non swap-based products.

          As for the choice of brokerage, I don’t see the large difference that you see (I don’t agree with the $1000 to $4000 a year difference).

          But that’s fine. We don’t have to agree, and we can choose different brokerages. It’s more important that we each select a brokerage we’re individually comfortable with. I’m not an expert on U.S. estate tax. As for perceived risks, you’re corresponding with a guy who doesn’t even have the guts to ride a roller coaster or go scuba diving, so keep that in mind.

          More importantly, the choice of the brokerage won’t make or break your future. Far more important, is the amount we save and how we behave as investors. That’s the ten-foot high cake. The brokerage might be the centimetre high icing.


  124. Rob Paul says:

    Hi Andrew, or whoever else can provide some insight,

    First off, @Andrew, thanks for Millionaire Expat, tremendous insights and FUN to read.

    As an American living in Germany, Im putting together an ETF portfolio using Interactive Brokers. There seem to be some issues related to the domicile of the ETFs. The US-domiciled ETFs are typically cheaper, larger and more liquid, and there is a greater variety. However, they are subject to US Estate Tax – at least, that’s what I’ve gathered from various posts, and I haven’t seen anything saying I’m exempt from that as a US citizen. Correct?

    Anyway, it seems like since Jan. 1, 2018 it hasn’t been even possible to trade US-domiciled ETFs if you’re an EU resident, due to the so-called PRIIPs legislation by the EU. On IB these ETFs show up as “not available for trading.”

    I don’t know if there’s a way to trade these ETFs over a European brokerage, or if I should even want to due to the Estate Tax problem.

    Any insights? Thanks in advance and have a nice day.


    • Hi Rob,

      First of all, as an American, you don’t face the same estate tax limits. In this story, I explain that you have a much longer rope. https://www.internaxx.com/expat-investor/smart-investing/little-known-mistake-many-expats-make

      Second, are you 100% certain that IB will not allow you to buy U.S. domiciled ETFs, as an American living in Europe? Did they tell you this directly? This is news to me.


      • Rob Paul says:

        Hi again Andrew,

        First of all I find it fairly amazing that you take the time to answer all these questions posted here. Not a given. I’d love to buy you a beer if you’re ever in Berlin.

        That information about ETF-related Estate Tax for American expats is helpful, although I’m leaning toward accepting the higher cost of UCITS ETFs anyway, since I have little confidence that US policy won’t get even worse in the future.

        As far as my inability to buy US-domiciled ETFs through Interactive Brokers, yes, that appears to be the case. It’s a recent development, since Jan. 1 2018, when the European PRIIPs regulation went into effect.

        I spoke on the phone customer service from IB and was told the same: I cannot trade trade non-EU-conforming ETFs. (To be clear, my account is with the London-based branch of IB.) I also spoke with service reps at Lynx, Consors Bank and CapTrader, and the situation is the same. Schwab International seems to be an exception; I was told on the phone that they would allow this, although I havent tested it.

        As I said, I’m leaning toward accepting the EU-ETFs anyway. The fees are a bit higher, maybe 0,25% as opposed to 0,10%; the transaction costs are a bit higher; there are sometimes spreads to absorb; less liquidity, etc., but it just feels like a less unfriendly regime. Or would you advise otherwise?

        thanks again,

        • Rob,

          Can you open an account with U.S. based IB instead of with the UK division?


          • Mark A Zoril says:

            HI Rob and Andrew again. Well, it looks like you might be right Rob, I tried to set-up trades on two of my clients in Spain. Both Anericabs. New message about how they are not allowed to trade this type of investment. So, will do a bit of homework. Another option might be Schwab out of the UK office. They accept US clients in Europe. I have reached out to one of my clients to see if here trading privileges in the US have been suspended. I know she traded as recently as early June. Also, Rob, I believe that Shwab International is different than Schwab UK.

        • Mark A Zoril says:

          Hi Rob and Andrew. Rob, I have hundreds of US clients around the world that use IB. Many are in Europe. Up to this point, I have not seen any issues at all with my clients ability to buy ETF’s that trade in the US. I have had many clients open accounts since January 2018 and still no problems. All applications to IB go through the UK office if you live Europe. IB routes its applications to the appropriate office based upon your country of residence. Maybe a change is coming, but up until this point, there has been no disruption in my US clients ability to trade in the US markets..

  125. Rob Paul says:

    Thanks, Mark. That’s strange. I am definitely not able to trade these (US-ETF) shares. I wonder if the difference might be in the account settings. IB posted in the FAQ:
    Opening orders from **retails investors**(my emphasis) residing in the European Economic Area (EEA) that are associated with a product that does not comply with the EU’s Packaged Retail and Insurance-based Investment Product Regulation (PRIIPS) will be rejected.
    So, in the account settings, I found that I am in fact an “Individual Retail Investor” as opposed to a “Professional Investor” as defined in Article 4.1 (11) of MiFID II. Perhaps your clients, by virtue of being clients of an investing professional, have a different status in their account settings.

  126. Rob Paul says:

    Thanks, Mark. Interesting. Still, I am unable to trade US domiciled ETFs. I suspect the difference lies in the account Settings: I am classified as an individual retail Investor, whereas your clients might be classified as professional Investors, by virtue of you being their advisor. Check here:
    @Andrew, I’ll look into getting a US-based IB account.

  127. Tyler P says:

    Hi Andrew,

    Fantastic books. Loved Millionaire Teach and Millionaire Expat. My goto re-reads for long haul flights.

    Quick question for anyone who might know.

    I am a Canadian Expat, living abroad for 10+ years. After reading Andrew’s books, I opened my first brokerage account 8 months ago with Interactive Brokers (US based).

    Upon Andrew and others advice, I have only purchased Ireland domiciled Index ETFs to avoid any U.S. Estate tax issues. But I also currently have a substantial Cash balance in my IB account. Does anyone know if there are any U.S. Estate Tax implications for this Cash balance if I should happen to die?


    • Mark A Zoril says:

      Hi Tyler. Yes, you could have some estate tax issues if you had cash in IB and died. Would need to be more than $60K. BTW, you can buy ETF’s domiciled in Canada and avoid the US Estate tax issues. You don’t have to buy in Ireland domiciled ETF’s.

      • Tyler P says:

        Hi Mark,

        Thanks for your reply.

        I do not plan on retiring in Canada, thus I selected some low ExpenseRatio iShares ETFs denominated in USD (IWDA, IGIL, EIMI) domiciled in Ireland


    • H Gehrig says:

      I’m extremely keen to open an IB account as well due to the incredibly low costs of doing business with them, compared to the competition. This is all unofficial information, but for the countless forum threads and links to the IRS’s website I’ve read, from what I gather, anything above $60 000 USD [in cash] is in the jurisdiction of the situs. It’s actually quite vague on the IRS’s website, especially when it references some bank accounts that generate interest being exempt etc. However, it seems like cash in a brokerage account is liable for Estate Tax.

      I think some professional advice is in order.

      Hopefully someone can shed some light on this, because IB seems to be a real bargain.

    • Dave says:

      Apparently USD cash held in a brokerage account is subject to estate tax … read further https://www.ghsklaw.com/sitefiles/4482/u.s.estate.and.gifttaxrules.pdf

      Perhaps you could hold it in nonUS currency , CAD or Euros …which would not be US situs asset (not subject to estate tax) Or US treasury bills , also not subject.

      • Tyler P says:

        Thanks for the link Dave.

        Holding it in another currency is fine with me and a great idea. The IB FX platform allows for very cheap conversion

        Are you relatively certain it is not subject to US estate tax if it was in say EUR?

        Thanks again

        Tyler P

  128. Vijay says:

    Hi Andrew – Thanks for the wonderful work you have done. I am a US citizen and planning to return to India for good. Will keep the US Citizenship. Hence as an expat – what brokerage account I can keep for life and continue to invest. Reading everything on the web it does not seem like I have access to the vanguard and charles schwab options. What other options I have to just open and keep it for ever.
    Thanks Vijay

  129. Vijay says:

    Hi Andrew – Another question. I am new to investing and went through several articles by you and others and investing on passive index funds seems to be a great way to create wealth over long term.

    However when I look at other theories of active management funds with fees, that also makes sense, such as automatic re-balance, tax loss harvesting offset the typical 1% fee of the good fund managers. Personal Capital , Betterment, Wealth-front at least claims that. How can i be thoroughly convinced with the approach one way or the other. I spoke to Personal Capital they mentioned that the volatility in their approach will be way lesser as they are diversified across industry , geographies on the 85 stocks they choose to invest and manage. Appreciate your comments and guidance. Or point me to something that i can read and gather..Looking at reading your book very soon.


    • Hi Vijay,

      There are no promises or guarantees when you’re investing money. There are only odds. The lower cost diversified portfolio of investments have higher odds of winning, in an equal risk-adjusted contest. But, there are no guarantees. Anyone who tries to give you a guarantee is a charlatan.


      • Vijay says:

        Thank you so much Andrew. Let me complete the reading your book. That might answer a lot of question I have. Will be in touch with you soon.


  130. Jamie says:

    Hi Andrew, I have a copy of both editions of your book and I am extremely glad that I withdrew from my Friends Provident ‘pension’ and began following your advice. One question – in the first edition of your book, for the British Couch Potato portfolio, you recommended the VWRD fund but in the latest edition you suggest VWRL. Is there any real difference and if I have already invested in VWRD do you recommend switching?

  131. Vijay says:

    Hi Andrew – I came across your articles in asset builder. I like the portfolios there but how do you compare the DFA Vs Vanguard strategy. Also what do you think about the adviosr fees asset builder charges, do you think it is worth it. Thanks Vijay

    • Hi Vijay,

      Based on statistical odds, you would make more money with AssetBuilder because they look after the behavioral difficulties. Most DIY investors, even with index funds, don’t perform as well as a group like AssetBuilder would after fees. DIY investors often get scared when markets fall 20-50%, and they end up chasing rising asset classes.


  132. Michael Martin says:

    Hello Andrew,
    I am a French expat Living in Switzerland and I bought your last book. At the moment I am really having issues deciding what to invest in because of the US estate tax. Unless I am mistaken, you forget to mention that the US have an estate tax treaty with 15 countries including UK, France, Switzerland and Germany, etc…


    Consequently, the 60k USD Limit does not apply for whoever plans to retire and die in one of these countries. What is your view on that?

    Also another comment from your book: you write that purchasing small caps is not worth it by comparing Small caps vs. Large caps. shouldn´t you rather compare large cap+small cap allocation vs. large cap only?

    Thanks a lot

    • Andrew Hallam says:

      Hi Michael,

      Because a non-U.S. domiciled portfolio of ETFs is so close to the cost of its U.S. domiciled equivalents, it no longer makes sense for many expats to buy U.S. domiciled ETFs. Country by country rules can be different, which is why it was far easier to suggest none- U.S. domiciled ETFs. For example, Canada and the United States have a tax treaty. Canadians don’t have to pay U.S. estate taxes on their RRSP or RESP holdings. But wealthy Canadians investing outside these tax-advantaged vehicles are liable for U.S. estate taxes when their worldwide assets exceed $5 million. With such minimal cost spreads between U.S. and non U.S. domiciled ETFs, it’s tough to create a case for U.S. domiciled ETFs for most non-American expats.
      As for small cap/large cap. Adding different factors (this is called factor-based investing) creates more behavioral headaches than it solves. A portfolio with half its U.S. exposure in large caps and half in small caps might do better. But according to Morningstar’s data on investors’ performance, factor-based investing causes more behavioral issues. If your portfolio were factor-based, and it underperformed much simpler portfolios over a 10-year period, would you give up on it? Most people would. Factor based investors expect to do better than the market, so when they don’t, they often jump ship. I’ve written a few articles on the behavioral difference. Interestingly, if you want to compare the S&P 500 (large caps) to a 50-50 small/large mix, go to portofoliovisualizer.com. They’ll let you do it back to 1985. U.S. large caps (as measured by VFINX) averaged 11.18%. An even mix of large (VFINX) and small (NAESX) rebalanced annually, averaged 10.94% over this same 33 year period. That’s not to say such a strategy might not end up being superior (see Larry Swedroe’s latest book) but most people wouldn’t have the patience if it underperformed for a decade. As a financial writer, I did my best to think of the best strategy for the typical person.

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