Apologies for the cross-post; I sent this to the career trader forum and received no replies. Ok, I'm leaving my day job and moving to Australia. (Fortunately, the wife has a day job.) So, to trade full-time do I incorporate? Where? U.S.? IBC? As what? Sole proprietor? Any foreign tax issues? I'm running mid-six figures of my own money, shorting futures options, equity and index options, some futures, going long and short and the rare special situation. (Looking mainly to put annual profits in a tax-deferred retirement account (or fully deduct losses.) I assume trader status is no problem, now, as I won't be working elsewhere, except for some freelancing and consulting, and I will be trading almost daily, maybe 10-15 trades; I also assume I don't get the overseas income tax break because this is not "earned" income abroad ... unless I incorporate .... abroad?) Thoughts? Caveats? Advice? Go directly to a professional for help?
Not sure if the site/ book is useful to you. http://www.knowledgecentre.net.au/html/s01_home/home.asp?tnid=home&dsb=40 "This book is a must for business owners and investors! Discover how the rich use company and trust structures to protect their assets and minimise their tax." http://www.knowledgecentre.net.au/h...p?id=117&nav_cat_id=135&nav_top_id=55&dsa=148
I'm from Brisbane, but have lived Stateside for over 20 years (go figure). Can't help you on all the legal/tax issues - clearly you should get an international tax expert for this - an offshore setup is most likely your best option. The biggest issue I have faced, when trading my U.S. markets from Australia, is the timezone issue. Basically, midnight to dawn - that sucks. So, unless you already mostly trade Asian and European markets, or LTTF systems, think seriously about your nite owl capabilites. Just my 2 cents. (PM me if you want to talk more.)
"Aggressive Tax Planning" http://www.ato.gov.au/atp/pathway.asp?pc=001/008/001&mfp=001/008&mnu=4846#001_008_001
Thanks, I'm an early riser as it is and wishes the markets in the US opened earlier on the east coast. I'm going to try and abbrevoiated from from 5-8 a.m. in Sydney to see if I can catch the US markets as they close. Then maybe a nice leisurely breakfast? Otherwise, I'll have to look at this 1-2 year posting as a learning opportunity for Asian markets.
It's a good time zone here, you have all the asian markets during the day and then the opening of the european session late afternoon. Markets are markets, if you can make money trading US products you should do fine on others (futures/options, not equities). IMO, no need to stay up during the night (shit lifestyle) when there are great markets during the daytime to trade.
Totally agreed with Zentrader. If you traded Nikkei / SPI / STW or Kospi you probably have a 9:45 to 4:30 (no daylight savings time in Sunny Queensland) lifestyle. I prefer HSI so I trade 11:45 to 2:30 and 4:30 to 5:55 (knocking off 20minutes early to watch the news).
If you want to save on tax, consider setting up an Australian self managed super fund. You'll only pay 10% on contributions and depending on your age, you can deposit up to 50K a year I think. The more you contibute, the more you reduce your taxible income. It's designed that way to encourage Australian to save for retirement. If you manage your own fund (which is pretty much the same as managing a company), you can then invest that money in just about anything. But I think there are some restrictions on leveraged investments. You may even decide to loan yourself back the money for trading purposes and charge yourself interest. Only catch with a super investment is you can't access the money till you're 55. If you're interested do a google search on 'self managed super'. Offshore entity maybe be difficult as you're a US citizen which means you're obligated to pay on what your earn anywhere. And the US are better than anyone at tracking their citizens. So be careful here. Runningbear
You can close the superfund when you leave the country (normal sort of rules for "I have left Aus" apply). Also check out trading as a company as a way of increasing the maximum that can be invested in the superfund each year. Note that the funds money must be invested conservatively.
Thanks for the input, Zen. Quick question: why not equities? Learning curve, on the fundamentals, too long?