Snowy560

I expect this may have been asked before but I'll ask anyway: is it okay to continue to hold some UK shares if you don't have a UK address and you are in Canada?

And what is a nominee account? So on the computershare website, change of address section (when I was just about to update my address), it says something along the lines of if you change your address to a country where holding nominee accounts is not allowed, you will be removed from the service and they will write to you.

I'd be very grateful if someone could please explain to me what this is and if Canada is such a country. I couldn't find anything when I googled this yesterday that made much sense to me.

Thank you in advance.

S

quiltman

Don't know if Canada allows nominee accounts so can't help there. nominee accounts are where shares are purchased and held by someone else , but in your name. Usually used for hiding from the company whose shares you've bought who actually owns them. Often used when a competitor is quietly buying your shares! once they reach a certain level they do have to declare they own them.
alternatively, nominee accounts are used to buy shares very easily without too much hassle. My old share club used a nominee account to buy/sell shares as it was easy to just call them and say "buy 500 shares in X". If you are buying/selling shares in many companies , as we were , this is the easiest way instead of dealing with brokers for each individual company.Oh, and only one commission payment on the total transaction! worked well for us for 14 years - and still does.

Aviator

Why do you think it would not be OK? International investors and foreign companies own shares the world over. Transactions like this happen everyday on world markets.

Snowy560

I dimly recall issues if you're a US resident or I may have that wrong or I may be thinking about premium bonds or something.

I think I may be asking two Qs:

- is it okay to hold UK shares if you're resident in Canada? (answer: I think is yes)

- it it okay to hold them via a nominee account such as Computershare? (and I still don't really understand what this is).

S

Fedupandt1red

Hi Snowy560

It is perfectly ok to hold UK share whilst living abroad and a nominee account is by far the best way to hold them. Nominee accounts are set up with stockbrokers who hold the shares on your behalf and deal with all the paperwork and buying/selling transactions. The nominee will send dividends to a designated bank account quarterly or half yearly. You will receive regular statements and an annual report for a UK tax year, 6 April to following 5 April. When you set up a nominee you will have the option to let the broker know how much input you still want to retain or whether you give the broker full reign. You can set up an internet nominee account but it is still run by a stockbroker.

Having said all this, you will need the check that a broker will take on your investments. Unfortunately, living overseas means that we are up against UK money laundering regulations. But as the investment already exists I'm thinking that you could still consolidate them in to a nominee.

You will need to report the UK dividend income on your Canadian Tax Return in dollars using the average exchange rate from the Bank of Canada. An average is used because the dividend is paid irregularly (the day of payment by the company, not the day you receive it in your bank account). You should be able to claim a 'foreign tax credit' when calculating your Federal/Provincial tax so that you do not get taxed twice on the dividend. There is a double taxation agreement between the UK & Canada which reduces the problem of being taxed twice.

Hope this helps.

Snowy560

Thank you very much for your reply which I think helps explain what I need to know. I think the companies (that a person holds the shares in) must arrange with companies such Computershare to do all the admin for them. I have had these shares for ages (given to me at work) and I can't remember at what point Computershare starting looking after them (and I didn't pay much notice because the dividend is paid straight to the bank account etc.). Everything works exactly as you describe: I get the yearly statements etc.

Yes I report the dividend income on the Canadian tax return, but I left the working out of the amount to the person at HR Block.

However, after starting this thread, I tried to change the address to a Canadian one but received the message that for a nominee holding it had to be a UK address (although it gave me all the options for all countries, including Canada). So I haven't quite worked out what to do next. The telephone number to ring is an 0870 number so I'll have to look for a geographic number if I want to contact them, but I just haven't done it yet. Stupidly, I left all this to the very last minute moment (didn't want to deal with it), although it's not too problematic as the dividend goes directly into my account.

I have still to switch the address to a Canadian one for my UK bank account and am anxious about this, although people on this forum have been reassuring, telling me they have done this with no problems.

Thanks very much again!

S

Fedupandt1red

No problems with UK bank accounts and overseas address. Just let your existing UK bank know, in writing. Again, you will not be able to open new accounts even with your own bank as you are caught by the UK money laundering regulations. However, you can move money between existing accounts. I have a current account & two savings accounts in the UK. Online banking is a wonderful thing.

L

Snowy560

Thank you again.
Yes I encountered the problem of trying to open another bank account when we needed a joint one for the house sale.
Happily, HSBC here opened us a joint GBP account and all went to plan.
You've motivated me to finish my address change process. Today (or tomorrow)
Funny how I spend far more time worrying about these things than it takes to actually do them! I'm sure I'm not unique!

S