Expat Investing: The Complete Guide to Building Wealth Abroad

You moved abroad for a better life — a new job, a partner, an adventure, or simply the freedom to live somewhere that makes you happy. And then you tried to invest, and everything fell apart.

Your home-country brokerage froze your account the moment you updated your address. The local funds in your new country turned out to be tax poison back home. Your accountant back in the US or UK had never heard of the forms you suddenly need to file. You Googled “can I buy ETFs as an expat” and got 47 contradictory answers on Reddit.

This is the expat investing dilemma, and it is one of the most poorly understood problems in personal finance. Millions of people live and work outside their country of citizenship, yet the financial infrastructure — brokerages, tax codes, reporting requirements — was built for people who stay put. The result is a minefield of compliance risks, punitive tax rules, and closed doors that most expats only discover after they have already made expensive mistakes.

This guide is for you if you are a US citizen, UK national, or citizen of any developed country living abroad and trying to figure out how to invest without accidentally breaking the law or destroying your returns with avoidable taxes. It covers the tax obligations you cannot ignore, the brokerage problem, how to structure a portfolio that works across borders, and how to track it all without losing your mind.

It is not financial advice. It is a map of the terrain.

The Expat Investment Landscape

Investing as an expat is harder than investing at home, and the difficulty is not about stock picking or asset allocation. It is structural. The global financial system was not designed for people who live in one country, hold citizenship in another, and earn income in a third. When you cross borders, you inherit the full complexity of multiple overlapping regulatory regimes, and the burden of compliance falls entirely on you.

Here are the core challenges every expat investor faces:

Tax obligations multiply. You may owe taxes in your country of citizenship, your country of residence, and any country where you hold assets or earn income. The United States taxes its citizens on worldwide income regardless of where they live — one of only two countries in the world that does this (the other is Eritrea). The UK has its own complexities around domicile and remittance basis. Even countries with territorial taxation may still require you to report foreign assets.

Brokerage access disappears. Most brokerages are licensed to serve residents of specific countries. When you move abroad, your existing broker may freeze your account, restrict you to liquidation-only, or close it entirely. Opening a new account in your host country may be difficult without local tax identification or residency documentation. Some expats end up in a gap where no brokerage will take them.

Foreign exchange risk becomes unavoidable. If you earn in Thai baht but invest in US dollars and plan to retire in euros, you are carrying three layers of currency risk. Exchange rate movements can easily overshadow your investment returns in any given year, and most expats underestimate this exposure. For a deep dive into how this works, see How Currency Exchange Rates Affect Your Investment Returns.

Regulatory mismatches create traps. A perfectly legal and tax-efficient investment in one country can trigger punitive taxation in another. The most infamous example is the US PFIC rules, which impose confiscatory tax rates on Americans who buy non-US mutual funds or ETFs — the exact funds that their host country’s financial advisor would recommend. But PFIC is not the only trap. UK residents face different rules around offshore funds and reporting fund status. Australians deal with the foreign investment fund (FIF) rules. Canadians have the foreign affiliate and foreign property reporting regime.

Information is fragmented and unreliable. Cross-border tax law is genuinely complex, and most general-purpose financial advice — from bloggers, robo-advisors, or even local financial planners — does not account for it. The expat who follows standard advice (“just buy a low-cost index fund”) can end up with a five-figure tax bill they did not see coming.

The good news is that these problems are solvable. Expats can invest effectively, compliantly, and with reasonable costs. But it requires understanding the rules first, which is what the rest of this guide covers.

Tax Obligations You Cannot Ignore

Tax is the single most important variable in expat investing. Get it wrong, and no amount of clever portfolio construction will save you. The starting point is understanding what kind of tax system your country of citizenship and your country of residence use, and where the overlaps create obligations.

Citizenship-Based Taxation (US Citizens and Green Card Holders)

The United States is the only major country that taxes its citizens on worldwide income regardless of where they live. If you are a US citizen or permanent resident (green card holder), you must file a US tax return every year, reporting all income earned anywhere in the world, for as long as you remain a citizen or green card holder. There is no exception for living abroad, no minimum stay requirement, and no opt-out.

This has several practical consequences for expat investors:

The relevant IRS publications are Publication 54 (Tax Guide for US Citizens Abroad) and Publication 514 (Foreign Tax Credit). For a comprehensive checklist before you move, see Financial Checklist for Moving Abroad.

Residence-Based Taxation (UK, Australia, Canada, and Most Others)

Most countries outside the US use residence-based taxation: you owe taxes in the country where you are tax resident, based on the income you earn while resident there. When you leave, your tax obligations in that country generally end (with some exceptions for ongoing income sources like rental property).

United Kingdom: The UK’s system is complicated by the concepts of domicile and the remittance basis. UK tax residents who are not UK-domiciled can elect to be taxed on the remittance basis, meaning they only pay UK tax on foreign income and gains that they bring (“remit”) into the UK. However, after 7 years of UK residence, a surcharge applies (currently 30,000 GBP per year for the remittance basis), and after 15 years, you lose access to the remittance basis entirely. HMRC’s Self Assessment system is where you report this. Note that the UK government has announced changes to the non-dom regime, so this area is evolving — consult a current advisor. For more on UK-specific considerations, see our United Kingdom country page.

Australia: Australia taxes residents on worldwide income and has a Foreign Investment Fund regime. The Australian Tax Office (ATO) requires reporting of foreign financial assets, and there are specific rules around foreign pensions, foreign trusts, and controlled foreign companies. See our Australia country page for more detail.

Canada: Canada taxes residents on worldwide income and has extensive foreign property reporting requirements (Form T1135 for foreign property exceeding $100,000 CAD). Canada also has specific rules around foreign affiliate income and foreign accrual property income (FAPI). More at our Canada country page.

Tax Residency: The Critical Determination

Your tax obligations depend on where you are tax resident, and this is not always obvious. Tax residency is determined by each country’s domestic law and may consider factors like physical presence (often a 183-day test), permanent home, center of vital interests, habitual abode, and nationality.

You can be tax resident in more than one country simultaneously, which is where tax treaties become essential. If two countries both claim you as a tax resident, the tax treaty between them contains “tie-breaker” rules that determine which country has primary taxing rights. We cover this in detail in How to Avoid Double Taxation on International Investments.

The key takeaway: do not assume that leaving a country ends your tax obligations there, and do not assume that arriving in a country immediately creates them. Get a definitive determination of your tax residency status from a qualified advisor before making investment decisions.

The PFIC Problem (US Expats)

If you are a US citizen or green card holder, the Passive Foreign Investment Company (PFIC) rules are arguably the single biggest obstacle to investing abroad. They are complex, punitive, and easy to trigger accidentally. We have a detailed article on this topic — How to Invest as a US Expat Without Getting Trapped by PFIC Rules — but here is the essential summary.

What Is a PFIC?

A PFIC is any non-US corporation where either 75% or more of gross income is passive income (dividends, interest, capital gains), or 50% or more of assets produce passive income. Under Internal Revenue Code Section 1297, this definition captures virtually every non-US mutual fund and non-US ETF.

That Irish-domiciled Vanguard FTSE All-World UCITS ETF that every European investor uses as their core holding? PFIC. The SPDR S&P 500 UCITS ETF traded on the London Stock Exchange? PFIC. The local unit trust your Singaporean financial advisor recommended? PFIC. If it is a fund, and it is not organized under US law, it is almost certainly a PFIC.

Why It Matters

The default PFIC taxation method — the “excess distribution” regime under Section 1291 — is deliberately punitive. Gains are allocated across the years you held the investment, each year’s allocation is taxed at the highest marginal rate for that year (currently 37%), and an interest charge is applied on top. The effective tax rate can easily exceed 50% or even 60% of your gains. There is no preferential long-term capital gains rate. There is no step-up in basis.

Two alternative methods exist (QEF and mark-to-market elections), but both have significant compliance burdens, and the QEF election requires the fund to provide an annual information statement that most non-US funds do not supply.

How to Avoid the PFIC Trap

The most straightforward strategy for US expats is to invest exclusively in US-domiciled funds. US ETFs and US mutual funds are not PFICs because they are organized under US law. You can buy Vanguard Total Stock Market ETF (VTI), iShares Core S&P 500 ETF (IVV), or any other US-domiciled fund without triggering PFIC.

The practical challenge is that you need a brokerage that will let you buy US-listed securities while living abroad (covered in the brokerage section below). But from a tax perspective, the US-domiciled fund approach is clean, simple, and avoids the entire PFIC regime.

If you already own PFICs, do not panic, but do act. Consult a cross-border tax advisor about your options, which may include making retroactive elections, purging elections, or simply selling the positions and recognizing the PFIC tax hit now rather than letting it compound.

FBAR and Foreign Account Reporting

Beyond the investment-level rules like PFIC, expats face account-level reporting requirements. The most important of these are the FBAR (for US persons) and CRS-based reporting (for most other nationalities).

FBAR (FinCEN 114) — US Persons

If you are a US citizen, green card holder, or US tax resident, and you have a financial interest in or signature authority over foreign financial accounts with an aggregate value exceeding $10,000 at any point during the calendar year, you must file a Report of Foreign Bank and Financial Accounts (FBAR), formally known as FinCEN Form 114.

“Foreign financial accounts” includes bank accounts, brokerage accounts, mutual funds, and certain other accounts held at foreign financial institutions. The $10,000 threshold is aggregate, not per-account — if you have three accounts with balances of $4,000, $3,500, and $3,000, you exceed the threshold and must file.

Key facts about the FBAR:

For a step-by-step filing walkthrough, see How to File an FBAR as an Expat.

FATCA (Form 8938) — US Persons

In addition to the FBAR, US persons living abroad may also need to file Form 8938 (Statement of Specified Foreign Financial Assets) with their tax return if their foreign financial assets exceed certain thresholds. For US persons living abroad (filing single), the threshold is $200,000 on the last day of the tax year or $300,000 at any time during the year.

FATCA (the Foreign Account Tax Compliance Act) also requires foreign financial institutions to report information about accounts held by US persons to the IRS. This is why many foreign banks and brokerages refuse to accept US clients — the compliance burden of FATCA reporting is significant, and many institutions choose to avoid it entirely.

For a comprehensive overview of both regimes, see FATCA and CRS Explained.

CRS — Common Reporting Standard (Non-US Persons)

The rest of the world has its own information exchange framework: the OECD’s Common Reporting Standard (CRS). Under CRS, financial institutions in over 100 participating jurisdictions automatically exchange account information with the account holder’s country of tax residence.

If you are a UK citizen living in Germany with a brokerage account in Singapore, that Singaporean broker will report your account details to HMRC. If you are an Australian living in Thailand with a bank account in Hong Kong, the Hong Kong bank will report to the ATO.

CRS does not create a new tax obligation — it is an information exchange mechanism. But it means that hiding foreign accounts from your home tax authority is, for practical purposes, no longer possible. The lesson for expats is simple: report everything, because your financial institutions already are.

Choosing a Brokerage as an Expat

One of the most frustrating practical problems expats face is simply finding a brokerage that will accept them. The brokerage landscape for expats is a patchwork of restrictions, and the rules change frequently.

The Problem

Most brokerages are licensed to serve clients in specific countries. When you open an account, you certify your country of residence, and the broker’s compliance team uses that information to determine what products and services they can offer you. When you move abroad and update your address — or when the broker discovers your foreign address through CRS data exchange — several things can happen:

This happens because offering investment services to a resident of another country may require the broker to be licensed in that country, comply with local investor protection rules, and handle different tax reporting obligations. Most brokerages decide the cost of compliance is not worth the revenue from a single expat account.

Brokerages That Work for Expats

Several brokerages have built their business model around serving international clients. For a detailed comparison, see How to Open a Brokerage Account as a Non-Resident.

Interactive Brokers (IBKR) is the most commonly recommended brokerage for expats. They operate in over 150 markets, accept clients from most countries, and offer access to US-listed ETFs regardless of where you live (important for US expats avoiding PFICs). Their fee structure is competitive, and their platform, while not the most user-friendly, is powerful. International clients typically use the IBKR entity in their region (Interactive Brokers Ireland for Europe, Interactive Brokers Hong Kong for Asia, etc.).

Charles Schwab International serves US expats specifically. If you are a US citizen living abroad, Schwab International will keep your account open and functional. They offer access to US-listed stocks and ETFs, and their fee structure is straightforward. However, they may restrict certain products depending on your country of residence.

Saxo Bank is a Danish bank that serves clients across Europe, Asia, and the Middle East. They offer access to a wide range of global markets and are a reasonable option for non-US expats.

Local brokerages in your country of residence are worth considering if you are a long-term resident and want access to local markets. However, be aware of the tax implications in your home country — buying local funds as a US person triggers PFIC, and other nationalities may face similar cross-border issues.

What to Do Before You Move

If you are planning a move abroad, take these steps while you are still resident in your home country:

  1. Open accounts at expat-friendly brokerages before you move — it is easier to open an account with a domestic address
  2. Consolidate your investment accounts to reduce complexity
  3. Sell any positions that will become problematic in your new jurisdiction
  4. Download complete transaction history from any accounts you might lose access to
  5. Notify your financial advisor (if you have one) and get referrals for cross-border specialists

Building Your Expat Portfolio

Once you have sorted out your tax obligations and found a brokerage, the question becomes: what should you actually invest in? The principles of good investing do not change just because you live abroad, but the implementation requires some adjustments.

The Case Against Home Country Bias

Most investors have a strong home country bias — they overweight stocks from their own country. A US investor might have 80% in US stocks. A UK investor might have 60% in FTSE stocks. This bias is understandable (you know the companies, the currency matches your spending), but for expats, it can be actively harmful.

If you are a US citizen living in Spain, your expenses are in euros, but a home-biased portfolio is denominated in dollars. Every time the dollar weakens against the euro, your purchasing power declines even if your portfolio value is flat. Conversely, if you are a UK citizen living in Japan, a FTSE-heavy portfolio means your investments move in pounds while your rent is in yen.

For expats, global diversification is not just a theoretical best practice — it is a practical necessity. A globally diversified portfolio reduces the currency mismatch between your investments and your expenses. For a detailed approach, see How to Build a Multi-Currency Investment Portfolio.

Tax-Efficient Vehicles for Expats

The tax-advantaged accounts available to you depend on your citizenship and residence:

US expats can still contribute to IRAs and Roth IRAs, subject to income limits and the interaction with the Foreign Earned Income Exclusion. If you exclude all your earned income using the FEIE, you may have no “earned income” for IRA contribution purposes. Using the Foreign Tax Credit instead of the FEIE can preserve IRA eligibility, but the tradeoff depends on your specific tax situation.

UK expats generally cannot contribute to ISAs or SIPPs while non-resident. However, existing ISA and SIPP balances can remain and continue to grow tax-free in the UK. Whether the tax-free status is recognized by your country of residence is a separate question — many countries do not recognize foreign tax wrappers.

Other nationalities should check whether their home country’s tax-advantaged accounts remain available during non-residence and whether the host country recognizes them. Tax treaties sometimes address this (e.g., the US-UK treaty has specific provisions for pensions), but coverage is inconsistent.

ETFs vs. Individual Stocks for Expats

For most investors, broad-market ETFs are the right choice. For expats, ETFs have an additional advantage: simplicity. A three-fund portfolio (US total market, international developed, emerging markets) held through US-domiciled ETFs gives you global diversification, low costs, and clean tax treatment for US persons.

However, there are situations where individual stocks may be preferable:

The tradeoff is that individual stocks require more management, more transactions, and more record-keeping. For most expats, a small number of US-domiciled ETFs is the simpler and better approach.

Asset Allocation Considerations

Your asset allocation as an expat should account for several factors that do not apply to domestic investors:

Currency of future expenses. If you plan to retire in your host country, you may want some allocation to assets denominated in that currency. If you are a nomad with no fixed future location, a globally diversified portfolio naturally hedges across currencies.

Social security and pension entitlements. If you are accruing pension benefits in multiple countries (through totalization agreements), those benefits are effectively a bond-like asset. You might adjust your portfolio allocation to be more equity-heavy to compensate.

Real estate exposure. Many expats own property in their home country, their host country, or both. Real estate is a significant asset that should be counted in your overall allocation. See How to Track Real Estate Across Countries for practical approaches.

Liquidity needs. Expats often face higher cash needs — visa renewals, international health insurance, emergency repatriation — so maintaining a larger cash buffer than a domestic investor is prudent.

Double Taxation and Tax Treaties

One of the biggest fears for expats is being taxed twice on the same income — once by their country of citizenship or former residence, and again by their country of current residence. Tax treaties exist to prevent this, but understanding how they work in practice requires some effort.

How Tax Treaties Work

A tax treaty (also called a double taxation agreement or DTA) is a bilateral agreement between two countries that determines which country has the right to tax specific types of income. Most treaties follow the OECD Model Tax Convention and cover employment income, dividends, interest, capital gains, pensions, and other categories.

Treaties work by assigning taxing rights:

The Foreign Tax Credit Mechanism

For US expats, the Foreign Tax Credit (FTC) is the primary mechanism for avoiding double taxation. If you pay income tax to your country of residence on income that is also taxable in the US, you can claim a credit on your US return for the foreign taxes paid. The credit is limited to the US tax that would be due on the same income.

In practice, if your country of residence has a higher tax rate than the US (which is true for most of Western Europe, Australia, Canada, and Japan), the FTC will eliminate your US tax liability on that income. You will effectively pay the higher foreign rate and owe nothing additional to the US.

If your country of residence has a lower tax rate (common in Singapore, Hong Kong, UAE, and some Central American countries), you will owe the difference to the US.

For a detailed walkthrough of how to use the FTC and avoid double taxation, see How to Avoid Double Taxation on International Investments.

Totalization Agreements

Separate from tax treaties, totalization agreements (also called social security agreements) prevent double social security/national insurance contributions. Without a totalization agreement, an expat worker might pay social security taxes in both their home country and their host country.

The US has totalization agreements with about 30 countries. If you are a US citizen working in Germany, the US-Germany totalization agreement determines which country’s social security system you contribute to. Generally, if you are posted abroad by a US employer for less than 5 years, you remain in the US system; otherwise, you contribute to the host country’s system.

These agreements also allow you to combine work credits from both countries to qualify for benefits. If you worked 25 years in the US and 10 years in France, both countries count the total 35 years when determining eligibility (though benefits are calculated proportionally).

Concrete Examples

US-UK: The US-UK tax treaty assigns taxing rights on most investment income to the country of residence, with source-country withholding limited to 15% on dividends. A US citizen living in the UK pays UK tax on investment income and claims an FTC on their US return. UK pension income is generally taxable only in the UK. The treaty is available on IRS.gov.

US-Germany: Similar structure. Germany generally taxes residents on worldwide income at rates between 14% and 45%. US citizens in Germany pay German tax and claim FTC on the US side. Germany’s tax on capital gains (Abgeltungsteuer) is a flat 25% plus solidarity surcharge, which is typically high enough that no additional US tax is owed.

US-Australia: Australia taxes residents at progressive rates up to 45%. Dividend franking credits (a unique Australian mechanism) can create complications for US reporting. The FTC is available, but the interaction between franking credits and FTC is technically complex and usually requires professional help.

Country-Specific Considerations

Every expat destination has its own tax environment, investment infrastructure, and regulatory quirks. Here is a brief overview of the major categories. For detailed information on each country, visit the country-specific pages linked below.

Zero or Low Tax Jurisdictions

Some countries impose no income tax or very low tax rates, making them attractive for expats from a tax perspective:

The temptation in these jurisdictions is to assume tax is simple. For US persons, it is not — you still file a US return and owe US tax on worldwide income, offset by FTC for any local taxes paid. For non-US persons, the simplicity is more real, but CRS reporting means your home country knows about your accounts.

European Union

EU countries generally have high tax rates but well-developed tax treaty networks. Key considerations:

Asia-Pacific

Americas

Africa

Europe (Non-EU)

For comprehensive details on any of these destinations, visit our country pages linked above. And if you are a digital nomad moving between multiple countries, see the Digital Nomad Finance Guide for additional considerations.

Tracking Your Global Portfolio

Most expats end up with accounts in multiple countries, denominated in multiple currencies, subject to multiple tax jurisdictions. Tracking all of this is a genuine operational challenge, and most tools are not built for it.

Why Standard Portfolio Trackers Fail Expats

The typical portfolio tracker assumes you live in one country, invest in one currency, and use one brokerage. It shows your returns in your home currency and calculates gains based on domestic tax rules. For an expat, this breaks down in several ways:

Multi-currency confusion. Your portfolio might include US stocks (USD), UK property (GBP), a German pension (EUR), and cash savings in Thai baht. A tracker that only shows USD values misses the currency component of your returns entirely. Did your portfolio go up 5% in dollars but down 2% in the euros you actually spend? That matters. For more on this challenge, see How to Calculate Your Net Worth Across Countries.

Scattered accounts. You might have an IRA at Schwab, a brokerage account at Interactive Brokers, a pension from a previous UK employer, bank accounts in three countries, and a rental property in your home country. No single institution sees the full picture, and aggregating manually in a spreadsheet is tedious and error-prone.

Tax lot tracking. When you sell investments, the tax consequences depend on which lots you sell, when you bought them, what you paid, and the exchange rate at the time of purchase and sale. For US expats, you also need to track PFIC status, QEF elections, and mark-to-market elections at the per-holding level. This level of detail is beyond what most consumer tools support.

Net worth across borders. Your true net worth is the sum of all your assets (investments, cash, property, pensions) minus all your liabilities (mortgages, loans), converted to a common currency. Getting this number accurately requires a tool that understands multi-currency conversion, real-time exchange rates, and the ability to include non-investment assets.

What to Look For in an Expat Portfolio Tracker

An effective portfolio tracker for expats needs several features that most domestic tools lack:

If you are managing a cross-border portfolio manually today, you have likely experienced the spreadsheet sprawl: one sheet for US accounts, another for UK pension, another for FX conversion, another for net worth. It works, but it is fragile, time-consuming, and easy to get wrong.

For a deeper look at multi-currency portfolio construction, see the Multi-Currency Investing Guide. For the tax dimensions, see the International Tax Basics Guide.

Planning for the Future

Expat investing is not just about today’s portfolio. It is about positioning yourself for a future that might involve repatriation, permanent settlement abroad, or continued mobility. Each of these scenarios has different implications for how you should invest.

If You Plan to Repatriate

If you plan to return to your home country eventually, keep these considerations in mind:

For a comprehensive guide to the repatriation process, see How to Prepare for Repatriation.

If You Plan to Stay Long-Term

If your host country is your permanent home, gradually shifting your financial infrastructure to align with your new residence makes sense:

If You Are a Digital Nomad

If you move between countries without a fixed base, the challenges multiply. You need to establish clear tax residency somewhere (or risk being claimed by multiple jurisdictions), and your investment strategy should be location-independent. See the Digital Nomad Finance Guide for specific strategies.

Mixed-Nationality Couples

If you and your partner hold different citizenships, your financial planning becomes a two-dimensional puzzle. Each of you may have different tax obligations, different access to brokerages and tax-advantaged accounts, and different reporting requirements. Joint accounts can create unexpected reporting obligations for the non-account-holder spouse. See Joint Finances for Mixed-Nationality Couples for practical approaches.

Taking Control of Your Expat Finances

Investing as an expat is harder than investing at home. That is an unavoidable reality of a financial system built for people who do not cross borders. But harder does not mean impossible, and the expats who build real wealth abroad are the ones who invest the time to understand the rules, find the right infrastructure, and then actually invest consistently — rather than letting complexity become an excuse for inaction.

The core principles are simple:

The details are complex, but the framework is not. Start with compliance, build a clean portfolio, and track it properly.

If you are ready to bring your global portfolio under control, FlashFi is built specifically for expats and international investors. Track investments across brokerages, currencies, and countries — all in one place, with real-time FX conversion and consolidated net worth tracking.

This guide is for informational purposes only and does not constitute financial, tax, or legal advice. Consult a qualified cross-border tax advisor for your specific situation.

By David Brougham