How can a UK citizen by US shares?

March 22, 2007 3:30 AM

How would a private UK citizen, living and working in the UK, with no financial connection to the US, go about buying a few thousand dollars of shares in a NASDAQ-listed company? Talk to my broker, right? Where should my broker be? In the US or the UK? Any specific broker recommendations? Any tax/duty issues of which I need to be aware? Any other advice?
posted by caek to work & money (7 comments total)

To keep things simple, I'd use a UK broker with an account in the UK. If this scenario isn't doable, I'd forfeit the purchase altogether -- it'd involve too many nuisances.

Since you asked for "Any other advice," I'd recommend not purchasing any NASDAQ stocks at the moment. The US markets are particularly volatile right now, and that goes double for the NASDAQ. If you're buying the shares to make money -- and not because you like the company, or work for it, or feel a need to support it because you use its products -- stay on the sidelines for now.
posted by Gordion Knott at 3:37 AM on March 22, 2007

I know that you can do it with Interactive Investor (iii.co.uk I think). All it involves is signing and sending back an agreement to trade on the NASDAQ.
posted by BishopsLoveScifi at 3:40 AM on March 22, 2007

Gordian Knott: thanks for the general advice. I do have a specific connection to this company, and I'm certainly not thinking of investing in the NASDAQ generally!
posted by caek at 3:56 AM on March 22, 2007

I used to work for Barclays Stockbrokers, and while I've tried to repress the memories here's what I remember:

To deal in an overseas stock then you'll need to set up a UK dealing account with a Foreign Dealing facility added on.

Tax: There are tax declaration forms to complete and they'll be sent to you as part of the application, however, it's your responsibility to get tax advice specific to you.

That's because very few brokers are authorised to give tax advice and will tell you to speak to your account/IFA.

The stock will be held electronically for you by the broker or his overseas counterpart - for example in the US it could be Bank of NY. You'll get a statement of holding, don't expect share certificates.

You might also find that there's an admin fee to pay and you're unlikely to get any shareholder benefits. Your broker may also ask for proof of funds before dealing for you and given the time difference can't always guarantee the exact price you're after. It would be best endeavours when dealing.

The rest of the memories bring back nightmares so I'll stop now!
posted by Nugget at 4:13 AM on March 22, 2007

This can be done very simply using an on-line broker. I use iDealing.com. They offer trading in UK, EU and US listed shares. Setting up an account is pretty easy too. When I signed up a few years ago they were the cheapest around but I have a feeling that's not the case now. They are very much no-frills but I've never had any problems.
posted by patricio at 4:51 AM on March 22, 2007

I'm out of specialty--and Google seems to be down(!)-- but is there a GDR?
posted by Phred182 at 11:54 AM on March 22, 2007

Just about every online UK stockbroker in this list will trade in the NASDAQ.
You will need to sign a scary looking american tax declaration form, but apart from that it's easy.

If youre investing in the company you work for, just be aware thats putting a lot of eggs in one basket!
posted by Lanark at 2:18 PM on March 22, 2007