Non USA resident (JPN) buying via Taiwan bank, bank asks fill out USA Tax form but knows nothing about if need pay tax or is form for information only? Seems Taiwan has no capital gains.
If you’re buying US-domiciled securities as a non-resident alien you will be subject to a 30% withholding tax. I’d recommend skipping the Taiwan bank entirely and purchasing with someone like Interactive Brokers. They will allow you to purchase Ireland-domiciled securities.
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In a way, it doesn’t matter. You still owe US income tax. If you pay taxes here, you essentially subtract that from your US tax. If you don’t pay tax here, you’ll pay it to the US
I had this same question, and I honestly forget how it turned out here. One person at the tax office told me one thing and then another told me something else, and then they brought someone else in, and eventually I paid peanuts here. But I forget the how and why. Will be looking again soon…
How much fees did the Taiwan bank charge to buy US stocks?
If you’re going to buy US stocks through Taiwan banks then use their 複委託 brokerage, which have much lower fees (but they won’t tell you this)
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30% is a lot ! Is that on the net gain or the sales amount?
That is on dividends only. On the flip side, there is no capital gains tax. You must be aware of estate tax though. If you die, there is a tax on everything above 70K on USD cash and US assets.
Sure about the USD cash?
usd cash in the usa. not usd cash in another country.
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Sorry, actually it is 60K USD. Source:
Regarding USD cash, I think it is included:
“Cash in a safety deposit box in the US would generally be in scope. The same applies to special deposits with brokers and non-bank financial firms as well as immovable property.”
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I went back and looked at my emails with my US accountant about my TW taxes. The TW tax office told me (and filed my taxes for me according to this) that if your investment income is under a threshhold (“about 250k USD” I said, so I assume 7.5M TWD) then it’s not taxed here.
They only taxed my (US) salary.
That is the AMT (Alternative Minimum Tax) at around NTD6,700,000:
https://investtaiwan.nat.gov.tw/showPage?lang=eng&search=56
If your total income (local, and overseas) goes above that, you then ought to file on your overseas income and pay a % on that. Capital gains may then need to be submitted.
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I think you already need to start filing above 1 (?) million, but the deduction is 6.7 million.
Note that you only need to pay if the resulting percentage is more than what you’ve already paid through income tax.
If you’re paying a considerable amount of income tax, overseas income might be tax free even above the threshold.
So most of us will probably never be liable to this kind of tax.
Don’t they take it out for you automatically?
Only if he’s a US citizen.
I do not think so. It is Alternative Minimum Tax because under 6,7 million the regular taxes apply. There are no capital gains taxes on foreign income within the regular system of tax.