RetireJapan

captainspoke wrote: ↑Sun Aug 18, 2024 12:22 pm

ChapInTokyo wrote: ↑Sun Aug 18, 2024 7:13 am... The main advantage to investing in US ETFs at IB Japan instead of the Japanese brokers ...

The main advantage for US persons is that IB will accept you as a US person, with no limitations (c.f, japanese brokers) for what they will or will not sell you. For Americans, who want to invest in US things, I think it's the only game in town.
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Good point!

captainspoke wrote: ↑Sun Aug 18, 2024 12:22 pm

ChapInTokyo wrote: ↑Sun Aug 18, 2024 7:13 am... The main advantage to investing in US ETFs at IB Japan instead of the Japanese brokers ...

The main advantage for US persons is that IB will accept you as a US person, with no limitations (c.f, japanese brokers) for what they will or will not sell you. For Americans, who want to invest in US things, I think it's the only game in town.

ChapInTokyo wrote: ↑Sun Aug 18, 2024 7:13 am

Relik wrote: ↑Thu Aug 15, 2024 2:11 pm I have been looking into this as well and it seems it is possible to move ETFs bought with Interactive Brokers Japan to say Interactive Brokers Australia.

However the selection of ETFs on Interactive Brokers Japan is very limited outside US ETFs (puts you at risk of estate tax?) and Japan ETFs (not as good as Mutual funds).
Try this link for a full list: https://www.interactivebrokers.co.jp/en ... nges.php#/

So it does raise the question, is it better just to sell everything and start again when leaving Japan or invest in subpar ETFs so you can move them across when you leave?

Difficult question that I haven't figured out the answer to yet but will continue to research and would recommend you review the discussion on the post by AussieinJapan that has lots of good info.

I had a look at the ETF offerings at your IB Japan link. It seems to be the case that the US ETFs are pretty much the same US ETF offerings that you can get at Monex, SBI or Rakuten (ie. they have VT, BND, BNDX, BSV and VPU but no BNDW, SGOV, VNQ or VNQI for instance). The main advantage to investing in US ETFs at IB Japan instead of the Japanese brokers seems to be the ability to automatically re-invest your ETF dividends under IB's DRIP plan since you would have the ability to file for foreign tax credit when you do your tax returns, as well as the ability to have your dividends automatically re-invested. Now, if IB allows you to DRIP the dividends from the Japanese ETFs too, that might be quite a useful function.

As for the question of Estate tax, it seems that both Japan and the UK have Estate Tax treaties with the US so you probably do not need to worry about that.

ETF domicile recommendations by country of residence and domicile
https://www.bogleheads.org/wiki/Nonresi ... _US_stocks

Relik wrote: ↑Sun Aug 18, 2024 10:50 pm Thanks for the idea on DRIP, I will look into it.

I will look into the estate tax further but I think even if there are agreements in place, there seems to be a view online that there is a still a risk to estate tax and a potential huge impact if it is realized.

ChapInTokyo wrote: ↑Sun Aug 18, 2024 7:13 am

Relik wrote: ↑Thu Aug 15, 2024 2:11 pm I have been looking into this as well and it seems it is possible to move ETFs bought with Interactive Brokers Japan to say Interactive Brokers Australia.

However the selection of ETFs on Interactive Brokers Japan is very limited outside US ETFs (puts you at risk of estate tax?) and Japan ETFs (not as good as Mutual funds).
Try this link for a full list: https://www.interactivebrokers.co.jp/en ... nges.php#/

So it does raise the question, is it better just to sell everything and start again when leaving Japan or invest in subpar ETFs so you can move them across when you leave?

Difficult question that I haven't figured out the answer to yet but will continue to research and would recommend you review the discussion on the post by AussieinJapan that has lots of good info.

I had a look at the ETF offerings at your IB Japan link. It seems to be the case that the US ETFs are pretty much the same US ETF offerings that you can get at Monex, SBI or Rakuten (ie. they have VT, BND, BNDX, BSV and VPU but no BNDW, SGOV, VNQ or VNQI for instance). The main advantage to investing in US ETFs at IB Japan instead of the Japanese brokers seems to be the ability to automatically re-invest your ETF dividends under IB's DRIP plan since you would have the ability to file for foreign tax credit when you do your tax returns, as well as the ability to have your dividends automatically re-invested. Now, if IB allows you to DRIP the dividends from the Japanese ETFs too, that might be quite a useful function.

As for the question of Estate tax, it seems that both Japan and the UK have Estate Tax treaties with the US so you probably do not need to worry about that.

ETF domicile recommendations by country of residence and domicile
https://www.bogleheads.org/wiki/Nonresi ... _US_stocks

Introduction to U.S.- Japan Estate and Gift Tax Treaty
https://sftaxcounsel.com/blog/a-closer- ... ax-treaty/
In some cases, a non-U.S. citizen can utilize an estate and gift tax treaty to eliminate the U.S. estate and gift tax. The U.S. currently has treaties with 15 countries regarding estate, gift, or generation-skipping transfer tax. Some of the transfer tax treaties provide for more beneficial deductions, such as marital deduction and charitable deduction, or a larger exemption from estate tax than otherwise would apply to a non domiciliary of the United States.The U.S. has entered into a treaty with Japan that covers the U.S. estate and gift taxes. The treaty allows a $12.92 million deduction or unified credit for purposes of the federal estate tax on U.S. property owned by Japanese nationals in the United States. Under the U.S.-Japan estate and gift tax treaty, the estate of a Japan domiciliary is allowed a unified credit equal to the unified credit allowed the estate of a U.S. citizen in a proportion of the Japan domiciliary’s U.S. assets to worldwide assets.