US share trading costs


#1

Hi guys,

I am a beginner investor looking to do as much research as I can before I get my hands dirty when Freetrade goes live :smile:
Anyway, got a couple of questions regarding US share dealing (apologies if they have already been answered somewhere else).

  1. Will Freetrade provide a USD currency account (something similar to Revolut?) when buying US shares?

  2. I understand that UK stamp duty does not apply for US shares but will be liable to CGT as expected. However regarding US tax requirements Google mentions a W-8BEN form. Is this something you will implement automatically?

Regarding the app GUI for UK shares, I am guessing the stamp duty charges are shown in the ‘Review Order’ screen?

Thanks and looking forward to being onboarded!


(Big Boss) #4

Correct me if I am wrong but I believe ISA Cash must be held in GBP. Therefore, Freetrade will automatically do the back-to-back FXs, whether you are buying USD, EUR or HKD shares.

This seems to be the case for HL, III and other ISA providers.


(Rob Sexton) #5

@Cgwinning is spot on regarding currency accounts. For the time being we’ll automatically convert any cash back into GBP.

Yes, we’ll be providing functionality to complete the W-8BEN in app. In fact a lot of thought is going into the UX for this as we want it to be really easy and quick, so it doesn’t slow anyone down in being able to trade.

Yep, you’ll see it in the order review, as well as the contract note that you receive once the trade has settled.


(Calum McWhir) #7

It just means the ISA protects you from UK taxes only, and not foreign ones. Example of a foreign tax is US withholding on dividends, which per above is reduced if you have a W8-BEN in place but you’re still paying some tax that the ISA doesn’t protect you from.