Can I help you understand the tax payment issues in the US stock market and whether Interactive Brokers can avoid taxes? Recently, another group of people received a call from the tax bureau, struggling to compete in overseas markets and earning 100000 yuan. However, they were notified at the end of the year that they had to pay 20000 yuan in taxes. How do you feel? Even worse, if you invested 1 million yuan, lost 500000 yuan last year, and just recovered 100000 yuan this year, I'm sorry, you may still have to make a profit for this 100000 yuan, so obediently pay 20000 yuan! Why does the State Administration of Taxation know your overseas accounts like the back of your hand? The answer is CRS (Common Reporting Standard) A financial account information exchange network covering over 100 countries/regions worldwide. Hong Kong, Singapore, Australia, Canada... are all among them. Currently, the two Chinese securities firms with the highest number of users are still being investigated the most. The account triggering threshold for financial institutions in CRS member countries such as Hong Kong: Your individual financial account (including securities firms and banks) with assets exceeding $1 million at any point in the year will be flagged and the information will automatically enter the exchange process. Information feedback timeline: On June 30th of that year, the data was reported to the Hong Kong Inland Revenue Department. On September 30th of that year, after being organized by the Hong Kong Inland Revenue Department, it was packaged and sent to the General Administration of Taxation in mainland China. Before June 30th of the following year: You may receive a friendly "tax payment notice". What content should be returned? Your name, address, tax ID and other basic information. The total balance or value of the account. The total income of the account in that year (note: it is the total amount and does not have details, you need to pull your own statements to prove the cost). So as long as you are within the CRS system and your assets exceed the threshold, your overseas account is basically "transparent". Why did some retail investors with only a few tens of thousands of dollars also receive tax payment notices this time? The possible reason is that the trading volume is relatively large and has reached the threshold. Currently, the probability of small accounts receiving notifications is still relatively small. How to reduce the risk of data return? 1. The simplest and most direct way to keep a single account's assets below $1 million is to: Spread funds across multiple accounts in different countries and financial institutions, ensuring that no account exceeds the $1 million red line at any point in time (even for just one second!). Advantages: Simple and direct, able to avoid most automatic exchanges. Disadvantages: Management is troublesome and only addresses the symptoms without addressing the root cause. In the future, policy tightening may lower this threshold at any time. 2. Bypass CRS and switch to FATCA It means transferring your main battlefield from Hong Kong and Singapore securities firms to domestic securities firms in the United States (such as Interactive Brokers, First Securities, ChinaAMC, Morgan Stanley, etc.). Because the United States has its own set of FATCA (Foreign Account Tax Compliance Act), although China and the United States signed the FATCA agreement in 2014, due to well-known political differences, it has not been officially implemented yet! This means that the probability of the data you have placed in your domestic brokerage account in the United States being returned to Chinese taxation is extremely low. This is precisely the core reason why a large number of high net worth individuals choose American securities firms. How to determine if you have a "US Yingtong" or "Hong Kong Yingtong" account? Check the registered address at the time of account opening: Registered in China → Interactive Brokers USA → Account number "U+digits" Registered in Hong Kong → Hong Kong Yingtong → Account number "F+digits" Most of the countrymen open the US Yingtou account. According to feedback from the customer service of Interactive Brokers, one account has two accounts, one ending with an F and the other ending without an F. The customer service said that accounts with an F will receive feedback, while accounts without an F will not receive feedback. So if your Interactive Brokers account is U123456, the data will not be returned. The biggest problem with Interactive Brokers is the outdated interface and complex operation. Apart from these, they are all advantages. You can still use domestic securities firms for trading and market reading, but when placing orders, using Interactive Brokers has many advantages listed one by one. 1. The cost is only 30% of these securities firms' 2. Funds greater than $10000 have additional interest income 3. Ultra low financing interest rate 4. Currency exchange without wear and tear 5. An additional 1% of Interactive Brokers stock will be given as a bonus upon registration (registration can only be done using the link below) ->/www.interactivebrokers. com/transferable/haO463 Conscience, needless to say, of course, its greatest function is tax avoidance, and registration does not require proof of stock.