To open such an account, the most stringent thing is the qualification of the account holder. The main reason is that account holders must never be American residents (citizens or green card holders) to ensure that such accounts are for foreigners to invest in American securities. The main reason is the tax problem in the United States.
Brief introduction of foreign investors' account opening
To open such an account, you must complete the following procedures and conditions:
-Fill in the general account application form-Tax report: Non-US residents fill in the "W-8BEN Form" of the IRS-Proof of overseas permanent residence address is required. If you want to use the American address as your contact address, you need to fill out another proof form-if you want overseas relatives and friends to handle securities transactions on your behalf, you need to fill out a "transaction authorization"-capital gains are not tax deductible, but dividends depend on nationality.
Specifically, anyone who is not an American citizen or a legal resident of the United States, including "non-resident foreign individuals", can open an overseas investment account with an American securities company as long as he fills in IRS Form W-8BEN and declares that he is not an American citizen or resident. At that time, the brokerage company will withhold the US tax corresponding to the investment income of non-US investment customers according to the country of residence declared by the customers on the IRS form W-8BEN. Usually, this tax is much lower than the withholding tax of ordinary American residents, because ordinary foreign investors do not need to pay capital gains tax in the United States, but the tax corresponding to dividends of American companies varies according to different nationalities. For example, the rate in Chinese mainland is 10%, and it is 30% in Hongkong and Taiwan Province Province. But from the perspective of stock market investment, most of the biggest profits are capital gains, that is, the gap between the rise and fall of stocks or bonds. (For more information about tax rates applicable to non-US residents, please refer to IRS publications 5 15 and 5 19. )
At present, well-known American brokers who openly accept opening overseas investment accounts are Scott Securities, charles schwab, Fidelity, TD Waterhouse and so on. Most of them are high-quality brokers, and the commission is very low. The transaction commission is between 7-30 dollars each, which can be said to be very reasonable. Especially for overseas Chinese investors, Scott Securities and charles schwab have set up overseas investment account service zones, with descriptions of Chinese websites and Chinese telephone service lines, which can be said to be the flagship products. Interested parties can go online to the websites of Scottrade Securities and charles schwab.
To open such an account, the basic account opening amount required by each broker is different. For example, Scott Securities only needs US$ 500 (about RMB 3 100), while charles schwab's demand is slightly higher, requiring US$ 25,000.