Author Topic: German Broker/Investments  (Read 2874 times)

larmando

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German Broker/Investments
« on: August 26, 2014, 12:14:46 AM »
Hi MInvestors,

I live in Germany, although I'm not German myself, and a few months ago I started looking for a broker (to buy and hold a few ETFs). I found Onvista that seems to have a good deal (free "buy", and paid "sell" at 5.99+0.23% (max. 39 €)), as long as one keeps a monthly average balance. Since I intend to buy every month but not sell particularly (yearly for rebalancing?) it seems like a good deal. What are your thoughts? Does anybody use it and can recommend it or think it's not a good broker/deal? I've seen other posts mentioning targobank or flatex.de, which though charge per trade also on buy. Thoughts?

Also for ETFs/Funds I noticed there are these days quite cheap ones from Deutsche Bank (DB X-Trackers, on almost any index), and of course I'm comparing various options. Sometimes Amundi (which seems to be french) is cheaper. Harder to buy Vanguard, it seems, at least from Onvista. Again, thoughts?


Thanks!
« Last Edit: August 26, 2014, 12:17:31 AM by larmando »

JoanOfSnark

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Re: German Broker/Investments
« Reply #1 on: August 26, 2014, 02:55:06 AM »
hey- you didn't specify what you ARE (other than not-german), but if you're american, canadian, aussie, or possibly anyone else outside the EU, you might want to get some professional opinion from a banker concerning the legality of trading on the German market. I was told by 2 seperate bankers that as an American, it was illegeal for me to do so (and in fact, at one point Deutsche Bank got caught doing it and had to cash out all the Americans, regardless of the state of the market at the time).

ETA: or maybe it's just FATSA reporting to the US being too much of a hassle? Deutsche Bank and MLB definitely told me it was *illegal* though.

I'm also in Germany, and am having a hell of a time trying to invest anything in anything other than real estate- I ended up going with a broker back in the US that could deal in Euro as well. Keep me in the loop if you do find a legal way to do it though, please?
« Last Edit: August 26, 2014, 03:11:10 AM by JoanOfSnark »

larmando

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Re: German Broker/Investments
« Reply #2 on: August 26, 2014, 05:59:57 AM »
Sorry for not specifying. I'm an EU citizen, so I had no problem opening an onvista account, and was really just looking for advice from an economical point of view. I feel for you and have my own international amount of issues and real estate doubts, but those are not relevant here. :)

Unfortunately I don't have advice specific to the american citizen situation, as I haven't investigated it. Glad you could find an american broker that deals with Euros, though, that's a good start. As for real estate, not sure about buying it for investing, at least where I am it's quite a bit pricey!

Half-Borg

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Re: German Broker/Investments
« Reply #3 on: August 26, 2014, 09:13:10 AM »
do you speak german?
you might want to head over to Wertpapier-Forum for some advice on taxes and brokers. The situation is indeed quite differnt from the US.

It might still matter where you are from. Maybe you can save a bunch on taxes by opening a brokerage account somewhere else.

Be aware that db-x trackers does not actually hold any of the shares in the index, but uses SWAPs to exchange some portfolio for the index value.
Amundi can be a real freaking mess regarding taxes. But I don't feel like this is the right forum to discuss german tax law corner cases ;) And I'm a lot to lazy to do it in english.

larmando

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Re: German Broker/Investments
« Reply #4 on: August 26, 2014, 11:37:49 AM »
Unfortunately my German is not quite good. :( I speak a bit of it at the basic level, but not enough to have a good conversation in it. You sure you wouldn't share some knowledge in English? :)

Half-Borg

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Re: German Broker/Investments
« Reply #5 on: August 27, 2014, 04:36:39 AM »
Well, I don't know anything about foreigners and their tax situation, so all I can do is say how it works for Germans in Germany with a german broker.

Bascically there are a handful of possibilites:

1. The ETF pays out all dividends -> everything is fine, your broker handles the tax payment
(this also applies to funds, which have a small amount of "ausschüttungsgleiche Erträge" but pay out enough dividens to cover for the tax, which is most of them)

2. The ETF is based in Germany -> everything is fine, your broker handles the tax payment

3. The ETF uses SWAPs and does not produce "ausschüttungsgleiche Erträge", you can look that up in the  Bundesanzeiger -> everything is fine, there are no taxes to be paid

4. The ETF is based somewhere else and has "ausschüttungsgleiche Erträge" and no or a to small amount of "ausgeschüttete Erträge" -> you need to fill out "Anlage KAP" and pay taxes yourself. Keep in mind that iShares and some other companies handle this poorly and have to be treated this way, even though they pay out dividends. Always look for a "Thesauierung" regarding your ETF in the Bundesanzeiger. The Bundesanzeiger is the one and only reliable source!

5. The ETF is based somewhere else and does not publish anything in the Bundesanzeiger -> just forget it, buy something else

//Edit:In this thread someone pointed out, that some ETFs, which pay dividends still have a minor amount of "Thesauierung" I clearified what to look for.
« Last Edit: August 28, 2014, 03:56:40 AM by Half-Borg »

larmando

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Re: German Broker/Investments
« Reply #6 on: August 27, 2014, 06:04:33 AM »
Thanks for the suggestion, it's a great start: indeed being an EU citizen resident and working in germany makes my situation exactly the same as a german. I have no obligations in other countries, and germany taxes me fully.
This might get more complex if and when I were to move, but unfortunately I have no way to know that, right now.