Opening and managing an offshore broker account from mainland China

[dementior]

Hello everyone!

I have searched the forums a bit looking for something similar but could not find it. Basically like a lot of other people around here we have to consider retirement.

Does anyone have experience or knows first hand whether it is possible to open an offshore broker account from brokers either in Singapore or Hong Kong (Saxo capital, DBS vickers, CIMB...) from China?

 

I am a European (Spanish) expat in mainland China (officially registered and spending over 180 days in China a year) who receives a salary in RMB to my Chinese account.

• Once you have opened the account, is it easy to transfer monthly a fixed amount from China to the account?
• How does taxation on capital gains or dividends (from an "expat resident in China" perspective) work?

 

Any help will be much appreciated. thanks in advance.

regards

 

 

[carlo]

I opened and ran an account with Interactive Brokers from China many years ago (more than ten). Opening the account by itself should still be easy: you will have to file a W-BEN form with the US tax authorities certifying you are not a US person for tax purposes, and provide an acceptable proof of address to your broker. Funding it with onshore RMB deposits relies on the current Chinese regulations on currency outflows: I assume that the USD 50k individual quota per year is still valid so unless you have large RMB deposits and/or a large salary, you should be able to remit your savings out of China without issues.

 

Tax rules have become considerably more complex since I used to be a China resident. AFAIK if you've been a resident for less than 5 years or have been absent for at least 30 days, you should be able to exclude foreign source income from what is taxable in China. That depends on your full picture that I don't have -- things can get complicated quickly. Also be aware of the risk (for your heirs) of paying estate tax in third countries: eg if you fall under, say, US estate tax through your individual brokerage account, even if you've never set foot in the US.

 

If you're looking for specialised Asian brokers to invest in specific markets (eg. Korea), there are a few in HK -- the basic process is the same. 

[889]

Also, dividends from shares in US companies will normally be subject to withholding tax, the rate dependent on your qualification if any for tax treaty benefits.

[dementior]

thanks a lot Carlo and 889 for the information! I called yesterday one of the brokers and opening the account seems fine but I am still gathering information to understand tax rules in depth... I will try to post any interesting findings for other who might be interested.

 

cheers!