This post will discuss the accessibility of Hargreaves Lansdown for UK expats living abroad.
In particular, the following points will be covered:
- Is Hargreaves Lansdown available to British expats living overseas?
- What are the fees?
- What are the tax implications for investments?
- Pros and cons of Hargreaves Lansdown for British expats offshore
- Best alternatives to Hargreaves Lansdown UK
If you are looking to invest as an expat or high-net-worth individual, which is what I specialize in, you can email me (advice@adamfayed.com) or WhatsApp (+44-7393-450-837).
London Stock Exchange-listed financial services firm Hargreaves Lansdown offers pension and investment services to individual investors in the UK.
HL has been a significant participant in the UK retail investing industry. However, The Economist said the business has had to deal with problems relating to reputational concerns like leadership turnover and declining stock prices. Private equity groups are reportedly expressing interest in purchasing the company.
It’s vital to monitor this development as it may impact any investments you have or plan to have with them. Do consult with a financial advisor before taking any step.
Is Hargreaves Lansdown available to British expats living overseas?
UK expatiates can still access their HL accounts and top it up even if they live offshore, provided they keep staying within the European Economic Area or EEA.
They won’t be able to create new accounts, though, if they move to a nation outside the EEA and start paying taxes there. Unless they work for the British government or one of its agencies, those who relocate outside of the area will also not be allowed to make additional deposits into their accounts.
If expats decide to become a tax resident abroad, they can also be required to give their tax ID number.
Subject to the restrictions and conditions of the platform, they can continue to log in, trade and manage their current investments through the platform, nonetheless.
What are the fees?
There are various Hargreaves Lansdown fees and charges for using the platform from abroad.
- For holding funds, a charge of 0.45% is levied annually on the first £250,000
- 0.25% on the amount between £250,000 and £1 million
- 0.1% on the amount between £1 million and £2 million
- There is no charge on the amount over £2 million
- There is no annual fee if you own shares
- When purchasing or selling money, there are no dealing fees.
- The cost for trading shares online ranges from £11.95 for transactions with 0–9 trades in the previous month to £5.95 for transactions with 20 or more trades.
- One percent of the trade value, at least £20 and up to £50, is charged for phone and postal share dealing.
- When buying UK shares, the stamp duty is set at 0.5%, with leftover shares being rounded to the closest £5.
- On UK share trades over £10,000, the Panel on Takeovers and Mergers Levy is one pound.
- Shares in Ireland, France, Spain, and Italy may also be subject to Financial Transaction Taxes and Stamp Duty.
Other Fees
Although there are extra fees and regulations, HL permits foreign nationals to purchase shares in foreign markets. If an expat buys shares abroad, they will pay a foreign exchange charge in addition to the firm’s regular dealing commission.
No-Fee Transactions
- Opening an account
- keeping cash on hand
- inactivity
- transferring funds between HL accounts
- closing an account
- fund trades
- direct debits
What are the tax implications for investments?
Your HL account will continue to pay you gross income, which means no UK tax will be withheld from any dividends or interest you earn.
Should you reside outside of the UK, you might be required to pay taxes on this income where you currently reside in, contingent upon the terms of the double tax deal between the UK and your current nation.
Your Hargreaves Lansdown SIPP will often automatically pay UK tax if you withdraw any income from it. If a double taxation agreement is in place, you might be eligible to receive a partial refund of the tax you paid in the UK.
Wherever you may live, any lump sum you withdraw from your SIPP for your pension kickoff will remain free from UK tax.
Withholding tax may be applied to dividends or interest that you receive if you own investments outside of the UK inside your HL account. Depending on the terms of the dual tax treaty between the UK and the nation where your investment is kept, you also might be eligible to recover all or a portion of this withholding tax.
Whatever your place of residence, any capital gains in your HL Individual Savings Account or SIPP will remain without tax in the UK.
Pros and cons of Hargreaves Lansdown for British expats offshore
HL positives
Even though you are no longer a UK tax resident, if you already have an HL account and relocate overseas, you can usually keep using HL to monitor and trade your current investments.
Expats can create diversified portfolios with the platform’s broad range of financial products, which include equities, ETFs, bonds, and more.
The company is subject to Financial Conduct Authority regulation, which offers some degree of consumer protection and regulatory control.
The firm is well-known and can be a reliable investment platform in the UK for Brit expats.
HL negatives
Unless you work for the Crown, you are usually not able to add further money to your HL accounts after moving outside of the EEA. Your capacity to increase your investments may be hampered by this.
Because you don’t live in the UK, there may be more complicated tax implications for your HL investments, including possible problems with double taxes and withholding tax reimbursement.
HL is primarily intended for investors located in the UK, so it might not provide expats with the same degree of assistance or specialized services as many other international investment providers.
If a client decides to no longer reside in the UK, HL may decide to shut their account, which could cause an issue with your investment management.
Best Alternatives to Hargreaves Lansdown UK
British expatriates living outside the European Economic Area have fewer choices; they might want to look into alternative investment platforms more appropriate for their foreign status.
The particular features, costs, and suitability of these options may change based on the nation of residence of the expat and their specific investing requirements.
Interactive Brokers
A popular option for foreign investors is IBKR, which offers a large selection of investment products and is accessible worldwide. For foreigners searching for affordable trading choices, it offers inexpensive trading fees and access to international marketplaces. Crucially, IBKR permits foreign nationals to register and keep accounts even after moving overseas.
Charles Schwab International
Well-known financial services company Schwab provides brokerage services tailored to foreign nationals. The organization offers access to a range of investment products and is recognized for its excellent customer service reputation. It is a dependable choice for people who live abroad because it supports cross-border financial management and meets the special needs of expats.
Saxo Bank
Reputable brokers that support expats include Saxo. It provides various investment options, such as currencies, funds, stocks, and bonds. The company is widely accessible to British foreign nationals looking for a complete investing platform because of its global reach.
Pained by financial indecision? Want to invest with Adam?
Adam is an internationally recognised author on financial matters, with over 760.2 million answer views on Quora.com, a widely sold book on Amazon, and a contributor on Forbes.
