Opening IB US account from EU?

[mentalmind]

I am a non-EU citizen living in EU country and want to create Interactive Brokers US account. I am tax resident in EU country where I live right now but also have bank account and pay taxes in my domiciled non-EU country.

The problem is when I visit IB, I get redirected to their .co.uk website. My aim is investing in US entities which is not available to EU residents, like US ETFs. I have access to non-EU internet connection (without VPN) to create an account. But I have some questions that got me confused.

1- Can I create accounts on both .co.uk and .com with same ID but different tax-residence country info? ( I can provide address proof from both my EU and non-EU address)

2- Can I manage my account on IB .com from .co.uk website (as this is the website I can access within EU)

3- I have N26, Transferwise, EU bank accounts and would I get in trouble by sending USD/EUR money from these accounts to my IB .com account with non-EU tax resident details? As would IB wonder why Im sending money from EU accounts when I say Im in non-EU country?

4- Is there any website to send USD (like Paxum maybe?) to my IB .com account so there won't be any ties between my EU accounts? If I want to send USD/EUR from my non-EU account bank would charge me quiet big fees for SWIFT.

Thank you!

 

[JohnLocke]

Did you try to ask Interactive Brokers account at any point?

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[mentalmind]

I didn't create an account with them yet as I have these questions. And if you don't have any account with them contact via email option just directs you to bot faq.

So I couldn't find a way to send them an email to ask these questions.

 

[Martin Everson]

mentalmind said:
I am a non-EU citizen living in EU country and want to create Interactive Brokers US account.
Click to expand...

What is the purpose of wanting to open with IB's U.S entity in first place? You cannot as a EU resident open with IB U.S it is forbidden. You have to open with IB UK and support will confirm this.

mentalmind said:
1- Can I create accounts on both .co.uk and .com with same ID but different tax-residence country info? ( I can provide address proof from both my EU and non-EU address)
Click to expand...

Non-US clients are still forced to use IB UK. IB US is for US persons.

mentalmind said:
2- Can I manage my account on IB .com from .co.uk website (as this is the website I can access within EU)
Click to expand...

Two different entities. One is US company the other is UK company.

mentalmind said:
3- I have N26, Transferwise, EU bank accounts and would I get in trouble by sending USD/EUR money from these accounts to my IB .com account with non-EU tax resident details? As would IB wonder why Im sending money from EU accounts when I say Im in non-EU count
Click to expand...

No as long as account is in your name they its not an issue.

mentalmind said:
4- Is there any website to send USD (like Paxum maybe?) to my IB .com account so there won't be any ties between my EU accounts? If I want to send USD/EUR from my non-EU account bank would charge me quiet big fees for SWIFT.
Click to expand...

See previous answer

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Please note my posts should not be taken as financial or tax advice. Please seek professional advice in that respect.

 

[mentalmind]

Thank you Martin for you descriptive answer. My aim is investing in US ETFs that is not available for EU residing investors (because of paperwork).

Then would it be best to create IB UK account with my non-EU country details and don't mention anything about EU country im residing?

I don't know if US ETF's are not investable to people residing in EU or if it's okay you reside in EU but pay taxes to non-EU country.

 

[Martin Everson]

mentalmind said:
Thank you Martin for you descriptive answer. My aim is investing in US ETFs that is not available for EU residing investors (because of paperwork).
Click to expand...

U.S ETF's are exchange traded instruments available on U.S Exchanges. Not sure which ETF is not available to EU investors if EU investor has access to the U.S exchange.

mentalmind said:
Then would it be best to create IB UK account with my non-EU country details and don't mention anything about EU country im residing?
Click to expand...

If you really won't IB and don't want IB UK then perhaps try IB HK with non-EU details. Chances are it won't work but worth a try.

Low-Cost Online Trading | Interactive Brokers

mentalmind said:
I don't know if US ETF's are not investable to people residing in EU or if it's okay you reside in EU but pay taxes to non-EU country.
Click to expand...

You can invest in U.S ETF's as a EU resident without issues. Withholding tax applies on dividends they pay but you can get treaty rates of withholding tax if you complete a W8-BEN. Depending on which non-EU country you reside in you may not even have to pay taxes.

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Please note my posts should not be taken as financial or tax advice. Please seek professional advice in that respect.

 

[mentalmind]

Again thanks for the kind answer Martin. The issue I am try to find solution is explained here : US ETFs no longer purchasable in Europe

Because you can't purchase US ETFs at EU caused by some regulation change, I am trying to buy US ETFs via IB or another non-EU broker using my non-EU citizenship & residence info advantage.

I prefer to buy non Ireland domiciled US ETFs and pay taxes to my domiciled non-EU country but I am residing in EU now.

 

[John Spectre]

Actually what Martin said is not 100% correct.
IB USA entity process not only US residents. It also process many other countries. For example Serbia and Russia processed with IB US entity.

IB UK mostly for EU zone and Europe countries, but not all them.
Also, because of CRS question(i guess) IB migrate clients from non-CRS countries(like a Ukraine or Georgia) from UK entity to USA.

When you apply to registration, you are select country of your residence and IB site showed support phone numbers for this country. It will easy show you what entity will be used(you would see UK number or US phone number (or China or India if you select somewhere in Asia)).
So, if your non EU 'home' country assigned to the US entity you you just need process registration with it and everything will be ok.

 

[Martin Everson]

mentalmind said:
Again thanks for the kind answer Martin. The issue I am try to find solution is explained here : US ETFs no longer purchasable in Europe
Click to expand...

I see. However, have you looked at the ETF's you are interested in and checked if they are available to buy before going down this route?

mentalmind said:
Because you can't purchase US ETFs at EU caused by some regulation change, I am trying to buy US ETFs via IB or another non-EU broker using my non-EU citizenship & residence info advantage.
Click to expand...

Give me an example of an ETF you are looking for that's not available to you?

mentalmind said:
I prefer to buy non Ireland domiciled US ETFs and pay taxes to my domiciled non-EU country but I am residing in EU now.
Click to expand...

Your going to suffer withholding tax on foreign ETF's if its not listed in Lux or Ireland? This is not making much sense. Is it a tax issue you are concerned about. Perhaps say which EU country you are based in and the non-EU country? It would make a big difference to assessing the issue here.

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Please note my posts should not be taken as financial or tax advice. Please seek professional advice in that respect.

 

[mentalmind]

Thanks for your answer Martin. No I didn't check if they are available in the way I want to buy. Im just considering my options, I didn't take any steps yet. I just thought that I can use my non-EU citizenship/residence with US brokers to access US ETFs.

Some example UTFs that is not offered to EU people anymore: VOO, VTI, VXUS

Right now I reside in Ireland, ETFs are total pain here for investment as Ireland gets excessive taxes on the ETF and they have different taxation rules per UK, EU, non-EU based ETFs. So my current plan is investing in UCITS funds, then I might want to try US ETFs to use advantage of broader options without complex Irish taxation rules.

 

[Martin Everson]

mentalmind said:
Thanks for your answer Martin. No I didn't check if they are available in the way I want to buy. Im just considering my options, I didn't take any steps yet. I just thought that I can use my non-EU citizenship/residence with US brokers to access US ETFs.
Click to expand...

Ok good idea thu&¤#.

mentalmind said:
Some example UTFs that is not offered to EU people anymore: VOO, VTI, VXUS
Click to expand...

All brokers are not equal. If you are using Degiro for example it is not a good representation of whats available to clients in Europe 😉. They are one of my brokers that I find nothing U.S of interest is available there to buy. Different story with IB, Saxo, flatex etc etc where I can buy any US ETF if I wanted....not so on Degiro.

mentalmind said:
Right now I reside in Ireland, ETFs are total pain here for investment as Ireland gets excessive taxes on the ETF and they have different taxation rules per UK, EU, non-EU based ETFs. So my current plan is investing in UCITS funds, then I might want to try US ETFs to use advantage of broader options without complex Irish taxation rules.
Click to expand...

Ahh it all makes sense now 🙁.

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Please note my posts should not be taken as financial or tax advice. Please seek professional advice in that respect.

 

[7889]

I suggest you to consider alternative if you can't solve issue with IB - Monex Boom broker from Hong Kong. I've been with them for years and could not be happier.

 

[Nyep]

mentalmind said:
1- Can I create accounts on both .co.uk and .com with same ID but different tax-residence country info? ( I can provide address proof from both my EU and non-EU address)
Click to expand...

You need to create one account. You can choose where. In any case you don't need to (and shouldn't, if you want to stay with IB) lie about your residence.
You should be able to sign up with IB US by simply using a VPN that makes you look like you're in the US.
IB US is absolutely not limited to US persons - that is plain wrong.

mentalmind said:
2- Can I manage my account on IB .com from .co.uk website (as this is the website I can access within EU)
Click to expand...

See previous.

mentalmind said:
3- I have N26, Transferwise, EU bank accounts and would I get in trouble by sending USD/EUR money from these accounts to my IB .com account with non-EU tax resident details? As would IB wonder why Im sending money from EU accounts when I say Im in non-EU country?
Click to expand...

IB doesn't give a damn where you're depositing from, as long as it's an account in your name. Note that you can deposit EUR directly to their SEPA account in Germany and then convert it to USD within IB (at the real interbank exchange rate with a ridiculous 0.002% commission).

mentalmind said:
4- Is there any website to send USD (like Paxum maybe?) to my IB .com account so there won't be any ties between my EU accounts? If I want to send USD/EUR from my non-EU account bank would charge me quiet big fees for SWIFT.
Click to expand...

You don't need to. See previous.

 

[mentalmind]

Nyep said:
You need to create one account. You can choose where. In any case you don't need to (and shouldn't, if you want to stay with IB) lie about your residence.
You should be able to sign up with IB US by simply using a VPN that makes you look like you're in the US.
IB US is absolutely not limited to US persons - that is plain wrong.
Click to expand...

Thanks for the answer Nyep, I'm a bit confused though, I should use VPN to sign up to US service you said but should I say that I am residing in Ireland or non-EU country (my domiciled country)? I thought that EU residents can't invest in US ETFs and not sure if IB will allow that if I say I reside in EU.

 

[Martin Everson]

mentalmind said:
I thought that EU residents can't invest in US ETFs and not sure if IB will allow that if I say I reside in EU.
Click to expand...

You can invest in US ETF's as an EU resident. Just these funds can't be marketed to EU residents without a KIID sheet. It's the same way EU citizens can invest in offshore funds but these funds cannot market themselves in the EU.

As a EU resident you cannot open with IB US but don't take my word for it open your own support ticket and ask them like I did. Don't join people and use VPN hacks to open an account in U.S IB and bring yourself problems down the line for no reason as an EU resident. Do things by the book always.

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Please note my posts should not be taken as financial or tax advice. Please seek professional advice in that respect.

 

[John Spectre]

Nyep said:
You need to create one account. You can choose where. In any case you don't need to (and shouldn't, if you want to stay with IB) lie about your residence.
You should be able to sign up with IB US by simply using a VPN that makes you look like you're in the US.
IB US is absolutely not limited to US persons - that is plain wrong.
Click to expand...

Clients can't choose where to open account with IB in most cases.
IB itself determine it by own policy which is based on residence country.
Only few countries in the world (mostly in Asia) allowed to choose with which entity create account. But even this option is allowed from side of IB, not by a decision of client.

And VPN is useless here and didn't solve anything.
What is matter it's a background check of personal data in case client is a resident from a risky country (like a Russia, Turkey, etc).

 

[Nyep]

John Spectre said:
And VPN is useless here and didn't solve anything
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VPN simply controls where you are redirected by IB, and lets you sign up to the one you want. If you are redirected to IB UK or HK, you can make sure you are redirected to IB US and sign up there directly.

Note that IB UK is simply an introducing agent to IB LLC for the most part. Your positions are cleared and held by IB LLC anyway, even if you open with IB UK, and they are covered by SIPC. You should be able to open directly with IB US - it was possible in the past. VPN to IB US, and fill out all correct information, don't lie.

 

[John Spectre]

Nyep said:
VPN simply controls where you are redirected by IB, and lets you sign up to the one you want. If you are redirected to IB UK or HK, you can make sure you are redirected to IB US and sign up there directly.
Click to expand...

It don't change anything in process of creating of account.
You could come to any mirror of IB site in the world and from any place, but entity which will be used to work with your account will be selected by place of residence which is submitted during sign up and verification process.

Note that IB UK is simply an introducing agent to IB LLC for the most part. Your positions are cleared and held by IB LLC anyway, even if you open with IB UK, and they are covered by SIPC. You should be able to open directly with IB US - it was possible in the past. VPN to IB US, and fill out all correct information, don't lie.
Click to expand...

Not so simple.
Different entities of IB have different rules and obligations based of entity residence. And because of it, there is list of what is different according to the place where account is handled.

For example:
Information Relating to Customer Protection of Assets | IB Knowledge Base
Common Reporting Standard (CRS) | IB Knowledge Base

 

[Nyep]

John Spectre said:
You could come to any mirror of IB site in the world and from any place, but entity which will be used to work with your account will be selected by place of residence which is submitted during sign up and verification process.
Click to expand...

Not so simple, as you say. I naturally "belong" to IB HK. Other residents of this country are going via IB HK, simply because they got redirected there. I signed up directly via the US entity, and my account was opened there instead.

John Spectre said:
Different entities of IB have different rules and obligations based of entity residence. And because of it, there is list of what is different according to the place where account is handled.
Click to expand...

There certainly are different rules for different countries of residence, and IB implements those globally. E.g. there are some currency exchange rules applied where I am, and IB enforces them only on residents here, regardless of the IB entity you signed up with. Regardless, it doesn't change the fact that the clearing agent for IB UK is in reality IB US in most cases.

 

[John Spectre]

Nyep said:
Not so simple, as you say. I naturally "belong" to IB HK. Other residents of this country are going via IB HK, simply because they got redirected there. I signed up directly via the US entity, and my account was opened there instead.

There certainly are different rules for different countries of residence, and IB implements those globally. E.g. there are some currency exchange rules applied where I am, and IB enforces them only on residents here, regardless of the IB entity you signed up with. Regardless, it doesn't change the fact that the clearing agent for IB UK is in reality IB US in most cases.
Click to expand...

As I said few messages earlier - you are from one of FEW countries in the world where you able to select your HK or US entity.
It also available, for example, for China.
But almost all other residents of other countries can't do it.
Also, you can't sign with for example with IB UK or IB CA, etc. IB just reject application or will propose for you to select HK or US entity.
So, your assumption that client can freely select entity of IB is wrong. It's a limited by IB's policy.