Changing tax residency within EU and Degiro

[maska]

Hello everyone,

I am a bit confused to invest more with Degiro, since I have started investing not that long ago. Would you be so kind to advise me on what will happen if I change my tax residency?

1. Meaning, I am a Spanish resident, registered with Spanish Degiro and have my Spanish bank account linked. However, I am not sure what will happen if I move f.e. to any other country Degiro does not open accounts in or if I change my tax residency after a while to any other EU country? Will I still be able to invest with the same profile in Degiro? Will it change anything for me on withdrawal, meaning will I be taxed by the current tax country I am in?
2. Is it easy to change the bank account details, will I face any issues? Are there any other risks I might encounter in 5-15 years having my investments in Degiro broker I registered when I was in Spain?

(My investment goals are accumulating ETFs only, with a long-term vision so that only capital gain tax would apply most probably to these) Thanks in advance

 

[hummel2]

@maska You have to inform them but as long as you're in supported country you can use whichever Degiro domain you want. Tax declaration is onto you, I guess Degiro is providing some kind of annual statements for their customer

 

[klibera]

@hummel2 I can confirm that.

I You need to provide the changed details and your new Tax ID. since Degiro doesnt deduct any tax (except for the US) by default, you have to do your own taxes with the yearly summary that Degiro provides.

It might make it harder to claim your US dividend Tax back ( in my case not possible so I pay double tax to a degree).

My linked bank account is still in my old country and they have no issues with that.

 

[gooddad]

@klibera Interesting, in Czech Republic you don't have to tax anything that was already taxed in a different country. So since e.g. dividends were already taxed in the US, I don't tax them in Czechia.

IANAL but I think any country that has a tax treaty with the US (most or all EU countries) has the same system. Don't pay tax twice if you can avoid it

 

[klibera]

@gooddad czech has a treaty but somehow degiro doesnt want to do this tax request for me (i'm not czech, just work here)

maybe its too complicated for them

 

[gooddad]

@klibera I don't think you understand, I don't do any tax requests. US automatically taxes the dividends in the US, and so I just don't tax them in the Czech Republic. I give the trade confirmation document to my tax accountant, she looks at it, sees tax was automatically withheld in the US, and says that I don't need to pay taxes on it in Czechia.

 

[klibera]

@gooddad Ah okay that's interesting.

 

[emari333]

@gooddad So Czechia has it's own category for dividend income? in IE it's rolled in with income tax so most of the country pays 40% tax on dividends :O I just avoid dividend investing as a strategy

 

[gooddad]

@emari333 It's the same here, it's rolled in with income tax (15%). But you don't have to declare it for taxation if it was taxed in a different country that Czechia has a tax treaty with. I believe that's standard.

 

[magster1]

@klibera Degiro does auto deduct dividend tax (NL based)

 

[emari333]

@magster1 Only tax due to the US govt though right? You still have to pay what's due to the NL govt

 

[magster1]

@emari333 They withhold the 15%, I keep the rest. No CGT tax in the Netherlands, only wealth tax.

 

[emari333]

@magster1 awesome! How does wealth tax work?

 

[magster1]

@emari333 Get taxed over your total assets. Investments belong in that category (box 3). Up to 50k tax free, as a couple 100k. There are three different rates based both on two different rates each. Up to 50k 1.89%, 50-950k 4.5%; 950k+ 5.69%. The different rates are basically a weighing of the value based on 0.03% and 5.69% per category. Sorry, not the best at explaining hope it makes sense!

 

[bible_boy]

@hummel2

Tax declaration is onto you

Yes, but every year banks will disclose your balances to the State in which they consider you to be tax resident. If your country of origin is particularly aggressive in their pursuit of stealing your money and disputing your residency shift, it is actually very good practice to make sure all your addresses on file are not the old ones, especially if you move a lot of money (6 to 7 figures income).

In Italy, for instance, we have a list of countries that are considered blacklist: if you move to these countries, the burden of proof is on you to demonstrate that your "center of vital interests" has moved there. It literally doesn't cost them anything to dispute your residency, and they're free to judge "center of vital interests" however the fuck they want.

If you're moving out of a communist distopian shithole country like Italy, make sure no bank has your old address, doesn't matter wether or not you're following the law... you don't want it to be freely interpreted against you.

This might be a problem with some providers if they don't support the country you're moving in (any reference to Revolut not wanting Georgian or UAE residents is intentional), which is why you should plan to use them only while transitioning but then no more.

 

[tombe]

@bible_boy @bible_boy so if you live outside Italy (no fiscal residency there) but in Europe it should be safe right? I believe the problems will start once and if you want to move back to Italy and you have to somehow migrate your portfolio - unless you use Degiro i.e. that can transfer everything for you, but I have no idea how taxes work there

 

[bible_boy]

@tombe Post is 1 year old my friend, I don't remember the context very well

Can you clarify your question a little bit? You're italian and moving your residency in another EU country, and you need to migrate the portfolio? Or is it the opposite?

I believe the problems will start once and if you want to move back to Italy and you have to somehow migrate your portfolio

EU to EU repatriation of money sounds non problematic to me, as long as you paid your taxes on the money that's going back.

Repatriation itself could be a problem, if your stay was very short (1 or 2 years), as they could argue your transfer was temporary, and claim taxes on the income earned abroad... still, it's a very remote possibility, and avoided by staying longer.

The technicality of moving your assets should be the least of your concerns, if everything is in order.

 

[tombe]

@bible_boy Makes sense, if you stay abroad for short period of time it may cause problems.

To clarify: I'm Italian, I moved to Poland and will invest here using Polish Degiro. One day (5 years down the line maybe?) I'll move back to Italy.

So my question is: when Degiro will transfer all my positions - let's say I only have Acc ETFs - to the Italian Degiro, are there any taxes to be paid anywhere?

 

[bible_boy]

@tombe Depends entirely on Poland, in this case. Some countries (not a lot, surprisingly!) have exit taxes such that moving abroad is taxed just like a sale: make sure Poland has none.

 

[tombe]

@bible_boy Thanks!