funds for expats

tomcat_

does anyone have experience in buying funds from UK while being an expat that is non resident non domicile.

There are plenty of good fund supermarkets however all of them are for UK residents. What happens if someone is an expat for years? Does he/she needs to go through an IFA in order to get access to funds?

thanks

PipPip

I've been an expat for 3 years in France and did read on the Hargreaves Lansdown website that you can have a Vantage account and buy funds if you are in EU. I also met an IFA here in Paris who had access to some Assurance Vie tax wrappers based in Ireland, Jersey, isle of Man, those sorts of places which had UK domiciled sterling funds within them and worked for French as well as UK tax (cant remeber all the details but something about gross roll up basis and tax free withdrawals of a certain amount each year allowed after a period of time). All a bit complicated, fund of fund type structures and charges were shocking whilst performance looked weak so I walked away.

dunstonh

I've been an expat for 3 years in France and did read on the Hargreaves Lansdown website that you can have a Vantage account and buy funds if you are in EU.

Depends if they hold passporting permissions or not (I don't know - your post suggests they do).

I also met an IFA here in Paris who had access to some Assurance Vie tax wrappers based in Ireland, Jersey, isle of Man, those sorts of places which had UK domiciled sterling funds within them and worked for French as well as UK tax (cant remeber all the details but something about gross roll up basis and tax free withdrawals of a certain amount each year allowed after a period of time). All a bit complicated, fund of fund type structures and charges were shocking whilst performance looked weak so I walked away.

Remember that someone overseas calling themselves an IFA is not to be confused with an IFA in the UK. Different qualification requirements and authorisations. Many years ago, as regulation started to bite and some found they couldnt meet the requirements, they went abroad where standards were lower and effectively became unregulated sales reps flogging naff products to ex pats with little or no comeback.

As it happens, an offshore bond wrapper can be quite suitable for expats in the right circumstances and many are available on platforms or have open investment selection. So, the wrapper may not have been wrong. However, what you describe sounds like the expensive and poor quality versions offered by lower regulated firms with sales reps.

PipPip

Everything you say is correct. The guy I met was not a regulated IFA, very much a commission chaser. He was recommended by a neighbour but I felt uneasy with him fairly quickly and I was particularly annoyed when he seemed unable to explain some basic stuff. He could not tell me total charges I would pay, whether the funds could be in euro/sterling or a mix of both, investment returns over different periods (he only had information on periods selected to show the funds in their best light), who actually managed the funds in the complicated fund of fund type structures, whether it was multi-manager in the sense of hiring and firing the asset managers when they failed to deliver or in the sense of multiple layers of funds adding to the charges with little benefit etc. I would not claim to be an expert and I will gladly take advice when I feel I can trust that advice but in the case of the products he proposed for me, I walked away. But I do also understand that if you are overseas there are good bond products that can provide tax advantages and open architecture fund choices, but its a !!!!!! of a job finding them.

rockitup

I have also been an Expat for about 3 years now and with HL it depends where you live at to what facilities are available to you, see link below, mostly seems to refer to existing accounts
http://www.h-l.co.uk/investment-services/vantage-service/moving-overseas/account-option-results?country=1&go.x=11&go.y=13 then select your country from drop down box

Whilst abroad I found I could open an account with TD Waterhouse although account opening procedures were a little tougher than usual outside of EEA. They do funds & shares but in my opinion HL are better.
If you call TD Waterhouse on this number +44 161 819 6467, they can advise if they can open account in your country of residence

There is also Barclays Wealth International, but they have monthly fees if your net savings and investments with them are below £50,000. I was looking into opening an account with them and also an account with Barclays Stockbrokers for UK funds, the only thing I found difficult to find out is about the charges on any investments held direct through Barclays Wealth International. Their advisors/salesmen seem to attempt to steer me towards structured products (not worth it in my opinion)

BWI are probably worth it if you have £50k to stick in savings with them, and then get the Barclays Stockbroker account but if not it looks like TD Waterhouse may be your best chance

tomcat_

thanks for your replies and experiences.

Basically from my little research i can see that there are only few fund supermarkets for expats and they have limited choice.

Here is two ideas, i would love to hear your views:

1. What is stopping an expat buying funds from a UK based fund supermarket like fidelity and giving as an address his/her address in UK? Non resident non domicile individuals are not liable to CGT so i don't see any probs with inland revenue. The only prob is when you go for income funds when the income paid has the tax automatically deducted unless the fund manager applies to IR for gross payment.

2. Going to an IFA based in UK and the IFA buys and holds on behalf of the expat growth funds and income funds based on the instruction of his/her client?

rockitup

I think no problem with idea number 1 as long as you have some id (address verification) to open the account.

Mine was open already and I just changed the address to that of a family member, as you say no problems with CGT etc as long as your country of residence does not tax you on Worldwide Gains. As far as I know, the basic rate of dividend tax is lost anyway wherever you live, UK or outside and IIRC cannot be reclaimed

Jonbvn

When I was an expat I used this outfit to buy shares. I believe they offer funds, but I am not sure if they would be only offshore or similar to those in the UK.

http://www.internaxx.lu/

Jonbvn

Jonbvn wrote: »

When I was an expat I used this outfit to buy shares. I believe they offer funds, but I am not sure if they would be only offshore or similar to those in the UK.

http://www.internaxx.lu/

It would seem the funds are EU & $ denominated.

http://www.internaxx.lu/staticcontent/mutualFunds.html?navform_menuid=investment_mutualfunds

tomcat_

yeap i have seen this site...but it has limited funds and not all of them are in GBP.

Of the "UK based" supermarkets, would anyone strongly suggest any of them?

Fidelity looks good as it is a well know name, but there are many others.