Trading US Stocks

[Fiona96]

Hey everyone, another bunch of newbie questions here; this time around trading US stocks/ETF's.

I'm an Australian for tax purposes, living in Australia and am wanting to learn about trading (which may include day trading) in individual US stocks and ETF's. I would really appreciate some help to demystify some of the following :

Currency:

• Aside from choosing a broker/bank with low conversion fees and good exchange rates; how else are AUD/USD conversion costs minimised?
• Do brokerages allow you to operate separate accounts in different currencies and only pay exchange fees when you top up or cash out the USD?

Brokerages:

• Will I own the stock; ie will ownership be entered into the books under my name (US equivalent of CHESS) or will it be held in the name of a custodian?
• Are there any benefits / disadvantages to trading through an AU based brokerage with access to US markets; vs a brokerage based in the US?
• Fees: I know this will be a huge consideration...

Tax:

• Aside from the W8-BEN tax form, is there any other registration requirement with the US tax department or any other US agency?
• US Tax: My understanding is that an Australian non-resident alien does not have to pay the US government capital gains tax; but will have to pay a 15% withholding tax on dividends. Is this correct?
• ATO Tax: My understanding is that an Australian resident for tax purposes would pay ATO tax for US stocks in the same way they would pay if the stocks were based in Australia. Is it possible that depending on the Australian citizens individual circumstances, that they might receive a 100% credit for the dividend tax they'd already paid to the US government; through the ATO's Foreign Income Tax Offset?

US market tracking ASX ETF's:

• What are the key benefits / disadvantages to trading through these vs trading in US ETF's directly.

If these are the wrong questions, please let me know!

Thanks,

Fi

 

[Prepper Pete]

Hey everyone, another bunch of newbie questions here; this time around trading US stocks/ETF's.

I'm an Australian for tax purposes, living in Australia and am wanting to learn about trading (which may include day trading) in individual US stocks and ETF's. I would really appreciate some help to demystify some of the following :

Currency:

• Aside from choosing a broker/bank with low conversion fees and good exchange rates; how else are AUD/USD conversion costs minimised?
• Do brokerages allow you to operate separate accounts in different currencies and only pay exchange fees when you top up or cash out the USD?

Brokerages:

• Will I own the stock; ie will ownership be entered into the books under my name (US equivalent of CHESS) or will it be held in the name of a custodian?
• Are there any benefits / disadvantages to trading through an AU based brokerage with access to US markets; vs a brokerage based in the US?
• Fees: I know this will be a huge consideration...

Tax:

• Aside from the W8-BEN tax form, is there any other registration requirement with the US tax department or any other US agency?
• US Tax: My understanding is that an Australian non-resident alien does not have to pay the US government capital gains tax; but will have to pay a 15% withholding tax on dividends. Is this correct?
• ATO Tax: My understanding is that an Australian resident for tax purposes would pay ATO tax for US stocks in the same way they would pay if the stocks were based in Australia. Is it possible that depending on the Australian citizens individual circumstances, that they might receive a 100% credit for the dividend tax they'd already paid to the US government; through the ATO's Foreign Income Tax Offset?

US market tracking ASX ETF's:

• What are the key benefits / disadvantages to trading through these vs trading in US ETF's directly.

If these are the wrong questions, please let me know!

Thanks,

Fi

As with everything in life, you don't want to run out of steam

 

[divs4ever]

Important Information: U.S. and Canadian share markets moving from T+2 to T+1​

02 April 2024





Shorter settlement cycle for trades in U.S. and Canadian markets

T+2 to become T+1:

From 28 May 2024, settlements in the U.S. and Canadian share markets will occur trade day plus one business day, known as 'T+1'.

Withdrawal funds available one day earlier:

To place a buy order on your CommSec International Shares Account you must have funds available for trade in your International Wallet. The move from T+2 to T+1 will not impact the buying process, as funds are still required to be available before you place your order, not on settlement day. When selling shares in the U.S. and Canadian share markets however, you will experience a slight change. Tradable funds will still reflect your sale order proceeds once the order has executed. Transferable funds that you can withdraw will now reflect the sale proceeds 1 day earlier. These changes take effect from 28 May 2024.

Other international markets will continue to operate on a T+2 basis. Local business days for each specific market may be impacted by national public holidays. There are no other changes to the operation of your account.

For your information

Investing in overseas markets exposes you to risks including those related to movements in foreign currency exchange rates and market prices.

 

[karenjones]

Hey everyone, another bunch of newbie questions here; this time around trading US stocks/ETF's.

I'm an Australian for tax purposes, living in Australia and am wanting to learn about trading (which may include day trading) in individual US stocks and ETF's. I would really appreciate some help to demystify some of the following :

Currency:

• Aside from choosing a broker/bank with low conversion fees and good exchange rates; how else are AUD/USD conversion costs minimised?
• Do brokerages allow you to operate separate accounts in different currencies and only pay exchange fees when you top up or cash out the USD?

Brokerages:

• Will I own the stock; ie will ownership be entered into the books under my name (US equivalent of CHESS) or will it be held in the name of a custodian?
• Are there any benefits / disadvantages to trading through an AU based brokerage with access to US markets; vs a brokerage based in the US?
• Fees: I know this will be a huge consideration...

Tax:

• Aside from the W8-BEN tax form, is there any other registration requirement with the US tax department or any other US agency?
• US Tax: My understanding is that an Australian non-resident alien does not have to pay the US government capital gains tax; but will have to pay a 15% withholding tax on dividends. Is this correct?
• ATO Tax: My understanding is that an Australian resident for tax purposes would pay ATO tax for US stocks in the same way they would pay if the stocks were based in Australia. Is it possible that depending on the Australian citizens individual circumstances, that they might receive a 100% credit for the dividend tax they'd already paid to the US government; through the ATO's Foreign Income Tax Offset?

US market tracking ASX ETF's:

• What are the key benefits / disadvantages to trading through these vs trading in US ETF's directly.

If these are the wrong questions, please let me know!

Thanks,

Fi

Why not trade through TD365 with their US CFDs? Plenty of leverage, close spreads and no brokerage. (I'm not affiliated with them in any way, just love the platform).