In 2020, the UK officially left the European Union, throwing a wrench in the already complicated British foreign policy. Before the exit, traders could traverse the continent and conveniently trade on their trading accounts without worrying about being in the UK.
But now that that is all gone, using your trading account from anywhere else in the world has become more complicated if you’re British.
For all intents and purposes, you can still trade on your UK trading account even if you’re outside the country. However, it comes with a caveat. Trading with your UK account abroad will depend on the broker you’re using, the country you’re going to and how long you plan to stay. This piece will explore everything you need to know about trading with your Uk account around the world and the pitfalls you need to watch out for. We’ve also included the UK’s best forex brokers in this Trading Guide.
Is it Legal to Use Your UK Trading Account While Abroad?
When you move abroad for temporary residence or an extended period, most brokers in the UK will keep on managing your investment portfolio and even allow you to trade in some capacity. However, it’s not as easy as trading while still in the UK. Furthermore, the country you’re moving to needs to be on the pre-approved list British residents can trade from, and you cannot make any new investments while residing abroad.
The period you’re also going for will affect whether you can trade. So if you’re away from the UK for more than 180 days a year, you will lose your trading along with other privileges permanent residents enjoy.
One more thing you need to watch out for is ensuring that your move does not trigger capital gains tax on existing investments in your trading account. As a UK resident, you can use an Individual Savings Account, ISA, to invest in trading or other activities tax-free. Moving to another country or selling them while abroad might change your standing with authorities and cause you to get taxed on your gains.
You can also run into tax obligations from your new country of residence if you’re not careful when reporting your income. Improper reporting or not choosing your words correctly can leave you with a double tax bill, a situation you don’t want to face. And choosing a local broker might be a better solution, but only if you’re not planning to move a lot.
If you plan on shifting your country of residence from time to time, you’d be better off moving your trading account to an international broker. One in a tax-neutral jurisdiction will help you avoid double taxation while eliminating the need to look for a broker every time you change countries. This also means you don’t need to constantly change currencies, saving you time and money.
However, you still need to play nice even when using an offshore trading broker. Hiding your assets this way can lead to other issues you cannot get assistance legally. Instead, use reputable locations like the ones in Switzerland or Dublin.
But if moving your trading account to an offshore place is not your cup of tea, maintaining your home address might be another viable alternative. When you keep your home address after moving to another country, you will still have residency in the UK, and your trading account will enjoy all British citizens’ protections.
Furthermore, to still maintain your British IP while accessing your account, you can use an RDP or VPN or connect remotely to one of your UK computers. His will help not raise any alarms with your brokerage, and as long as they can still send you mail and your IP is in the country, you will be fine trading from around the world.
So, Can You Trade Abroad?
Online trading in the UK can be more freeing than most other careers. You can make a decent living while doing it from anywhere in the world. However, as we’ve seen, many caveats come with your trading account from moving to another country. So before you move, consider where you’re moving, how you will continue trading on your account, or even if you should.
