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BBCWatcher

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I wonder if they go correct the form, does that means it will take another year for them submit again or will it be done within the same year?
Kenghead, I'm starting to get a little impatient because I provided a link to the specific part of the IRS's published rules that explains all this. The IRS can levy fines if the withholding agent fails to provide you with Form 1042-S by August 15.

....Now will you stop worrying, please? There's nothing else you can do at this point except wait until the 2020 edition of IRS Form 1040NR is ready (and the 2020 edition of IRS Form W-7). That's at least 8 months from now. Standard Chartered has a legal obligation to provide you the necessary report for next year's filing. What else can be said? If you don't get the form, or if it isn't correct, you deal with it then as best you can. That's all you can do, and there's no use fretting about it now.
 

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Hi BBCwatcher, i apologise for causing displeasure. You are really knowledgeable and helpful, I appreciate for all the advice that you have given. Thank you again for being patient with me :)
 

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“Poaching” Hong Kong’s Talent?

There’s an interesting, provocative idea in this article: how about offering most Hong Kongers a special visa and a path to permanent residence? His specific idea is a “place-based visa,” meaning the immigrant would have to keep his/her home within a particular community for at least 5 years but then could apply for an unrestricted U.S. green card. The U.S. has gobs of empty and underutilized housing stock in broad areas of the country. His idea doesn’t have to be limited to the U.S., though.
 

ftpofmpo

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There’s an interesting, provocative idea in this article: how about offering most Hong Kongers a special visa and a path to permanent residence? His specific idea is a “place-based visa,” meaning the immigrant would have to keep his/her home within a particular community for at least 5 years but then could apply for an unrestricted U.S. green card. The U.S. has gobs of empty and underutilized housing stock in broad areas of the country. His idea doesn’t have to be limited to the U.S., though.

during the handover of hk to china, the gov had some special schemes for them, it was much^3 easier and quicker for them to gain pr than any other nationalities but few ppl took it up and significant number gave up later and headed back or elsewhere; some famous personalities was said to be reluctant to settle as their children will need to sacrifice 2 yrs to conscription

singapore is unlikely to be attractive to them

the thing which makes us wonder what would have happened if we had tried to poach talent after the collapse of the soviet union
 

ftpofmpo

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any idea how does the concept of residential ppty investment work for those with lots of spare cash?

if the developer is certain that property values will appreciate adequately and selling prices do not reflect this outlook, wouldn't they just hold on to and rent out the ppty they have developed to benefit from rising ppty values in future?

Otherwise it just shows that ppty price appreciation and rental yield have been factored into the current selling price? what benefits are there for retail investors who buy not to live in them but to rent them out and wait for ppty values to rise?
 

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the thing which makes us wonder what would have happened if we had tried to poach talent after the collapse of the soviet union
Good point! Israel and the United States are among the countries that realized significant gains from that particular immigration flow.

any idea how does the concept of residential ppty investment work for those with lots of spare cash?

if the developer is certain that property values will appreciate adequately and selling prices do not reflect this outlook, wouldn't they just hold on to and rent out the ppty they have developed to benefit from rising ppty values in future?
Maybe, but it’d depend on other factors such as taxes, depreciation, maintenance and carrying costs, rental levels, financing costs, competition, and so on.

Otherwise it just shows that ppty price appreciation and rental yield have been factored into the current selling price? what benefits are there for retail investors who buy not to live in them but to rent them out and wait for ppty values to rise?
I think it’s a bit silly if that’s what you’re asking, but one somewhat logical reason for doing so is how CPF effectively operates with forced saving for residential housing. When you effectively force employees to save for housing purchases, they tend to purchase more and bid up its price. So I wonder whether the government will at some point make OA contributions optional, as they already are for the self-employed. (And make SA contributions compulsory for the self-employed, to resolve the current differences.) And/or it’d also help if the government introduced low cost pooled “target date” funds for the CPF Investment Scheme, which is currently still way too expensive.
 

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Hi BBCW. Should a young working adult planning to retire in Singapore simply pay the full amount of income tax and invest the remaining cash in equities instead of utilising the CPF Cash Top-up Relief and Voluntary Medisave Contribution?

Let's say an individual earned exactly $54,000 the previous year. A total of $550 is taxable on his first $40,000 earned, and a 7% tax rate applies on the remaining $14,000. This means he has to pay $980 on the remaining $14,000. He can avoid paying this $980 by topping-up, for example, $7,000 into his SA and $7,000 into his MA (subject to the BHS and the Annual CPF Limit). Let's ignore all other personal income tax reliefs for simplicity. Is it worth locking up $14,000 in the CPF accounts just to "save" $980? He could simply pay the $980 in income tax, and invest the remaining $13,020 in equities that would likely earn greater returns than if they were simply sitting in the SA and/or MA. After all, the Government only pays extra interest on the first $60,000 of one's CPF combined balance. Moreover, if an individual is treating his CPF as the bond component of his portfolio, topping up an extra $14,000 might mean an underweighting of equities overall.

Let's assume instead that the individual earned exactly $94,000 the previous year. In that case, $3,350 would be payable as income tax on the first $80,000. An 11.5% tax rate applies on the remaining $14,000, which would mean another $1,610 would be payable. Is it worth avoiding $1,610 in income tax but locking up $14,000 in the CPF accounts? Does it make more sense to utilise the CPF Cash Top-up or Voluntary Medisave Contribution for tax relief only if the person is at a certain income tax bracket?

On a related note, I recall you mentioned that the SRS is generally more useful for those in higher income tax brackets. I take it one of the reasons is that those in a higher income tax bracket should first be exhausting the CPF Cash Top-Up and Voluntary Contributions to Medisave Account options available. Are there any other reasons in particular? And similarly, is there a particular income tax bracket you envision the SRS actually starting to become useful?
 

BBCWatcher

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Should a young working adult planning to retire in Singapore simply pay the full amount of income tax and invest the remaining cash in equities instead of utilising the CPF Cash Top-up Relief and Voluntary Medisave Contribution?
I don't think so. Getting near guaranteed 4% (or even 5% with bonus interest) interest plus tax relief for a bond-like vehicle, totally Singapore tax free and with strong asset protection, is damn attractive. Practically everyone should be able to find a place of pride in their portfolios for these CPF vehicles. That doesn't mean skipping equities entirely. "Some of both."

On a related note, I recall you mentioned that the SRS is generally more useful for those in higher income tax brackets. I take it one of the reasons is that those in a higher income tax bracket should first be exhausting the CPF Cash Top-Up and Voluntary Contributions to Medisave Account options available. Are there any other reasons in particular?
Yes, the tax savings are somewhat speculative. If for example you end up being a real estate tycoon with lots of rental income, your tax bracket in your retirement years could be quite high relative to today. Also, the Supplementary Retirement Scheme may not end up working at all if you retire in a country (or move to a country) that'll tax your Singapore tax advantaged SRS account. Many countries would/do.

Another advantage with MediSave versus SRS is that you can use MediSave dollars quite effectively in a family emergency involving medical care needs, without penalty.

And similarly, is there a particular income tax bracket you envision the SRS actually starting to become useful?
I think there's something of a general consensus that the SRS only starts to make sense in the 11.5% tax bracket and above. That's only a "rule of thumb," but I think it's a pretty good one.

You might decide to open a notional SRS account (with one dollar, or whatever the minimum is as long as it's reasonable) in order to establish the earliest contribution date/year under current rules (age 62 minimum qualified withdrawal age).
 

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Hi BBCW,

Do u have any comments on AXA integrated shield plan?? They seem good with their lower premiums and extensive coverage

But I’m worried there might be a catch that I didn’t see
 

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Can elaborate on why need to open one early ?
You might decide to open a notional SRS account (with one dollar, or whatever the minimum is as long as it's reasonable) in order to establish the earliest contribution date/year under current rules (age 62 minimum qualified withdrawal age).
 

rkesin

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Can elaborate on why need to open one early ?

Withdrawals are penalty-free when you hit the retirement age that was prevailing a the time of first deposit into the SRS (age 62 at the moment).

So for e.g. IF next year they increased the age to 65, but you deposited this year, you can still take it out when you turn 62. But if your first deposit were to be next year, you would have to wait til you are 65 before you can make a penalty-free withdrawal.
 

viventa

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Can elaborate on why need to open one early ?

Taken directly from the IRAS website:

Withdrawals are penalty-free only if they take place on or after the statutory retirement age (currently at 62) that was prevailing at the time of your first SRS contribution. If you have already opened an SRS account and made your first contribution, any subsequent change in the statutory retirement age (e.g. up to age 65) will not affect you (i.e. you can still begin your first penalty-free SRS withdrawal when you reach age 62).
 

BBCWatcher

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Do u have any comments on AXA integrated shield plan?? They seem good with their lower premiums and extensive coverage
They look pretty average to me across the board. Do you see something you particularly like about their plans?

Can elaborate on why need to open one early ?

Withdrawals are penalty-free when you hit the retirement age that was prevailing a the time of first deposit into the SRS (age 62 at the moment).

So for e.g. IF next year they increased the age to 65, but you deposited this year, you can still take it out when you turn 62. But if your first deposit were to be next year, you would have to wait til you are 65 before you can make a penalty-free withdrawal.
Yes, and even one dollar accomplishes this “date stamping.“ It looks like one dollar is allowed (I don’t see any minimum initial deposit), and you can open a SRS account online.
 

Kaypohji

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365 days of post hospitalization coverage
1 million limit
GP consultation fee at 12$ (good for retired)
Premiums also lower than AIA especially after 70 age

They look pretty average to me across the board. Do you see something you particularly like about their plans?




Yes, and even one dollar accomplishes this “date stamping.“ It looks like one dollar is allowed (I don’t see any minimum initial deposit), and you can open a SRS account online.
 

BBCWatcher

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365 days of post hospitalization coverage
1 million limit
GP consultation fee at 12$ (good for retired)
Premiums also lower than AIA especially after 70 age
OK, so for this comparison you’re looking at private hospital Integrated Shield plans. First of all premiums aren’t guaranteed, so AXA’s premiums could be 30% higher than AIA’s three years from now. You just never know. Second, AIA offers 13 months pre-/post-hospitalization of coverage for related care from panel providers, which is more than twice as much pre and a one month longer post. AIA doubles the annual limit from panel providers ($2 million v. AXA’s $1 million), and AIA has zero waiting period for undiagnosed/undetected congenital abnormalities. AXA limits community hospital coverage to 45 days and AIA has no such limit.

AXA and AIA are more evenly matched for public hospital A ward plans.

AXA’s $12 GP visits are nice I guess (consultation fee only), but remember what insurance is for: the big stuff. I think AIA wins this particular comparison overall. That said, I’m not a super huge fan of either one since I think it’s important to look at the public hospital plan segments even if you start with private.
 

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Yea I’m thinking to switch to public ward A after I retire or when the premium gets too high.

So I’m not only looking at private but also at public ward A benefits. Public ward A, AIA and AXA are similar but AXA still cheaper especially after 70

I think I saw a post that you recommends prudential? Prudential has the highest premiums if I’m not wrong....

OK, so for this comparison you’re looking at private hospital Integrated Shield plans. First of all premiums aren’t guaranteed, so AXA’s premiums could be 30% higher than AIA’s three years from now. You just never know. Second, AIA offers 13 months pre-/post-hospitalization of coverage for related care from panel providers, which is more than twice as much pre and a one month longer post. AIA doubles the annual limit from panel providers ($2 million v. AXA’s $1 million), and AIA has zero waiting period for undiagnosed/undetected congenital abnormalities. AXA limits community hospital coverage to 45 days and AIA has no such limit.

AXA and AIA are more evenly matched for public hospital A ward plans.

AXA’s $12 GP visits are nice I guess (consultation fee only), but remember what insurance is for: the big stuff. I think AIA wins this particular comparison overall. That said, I’m not a super huge fan of either one since I think it’s important to look at the public hospital plan segments even if you start with private.
 

lingalong

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Hi BBC,

Are VDEM and 2801:HK a good choice if I want to overweight on China? Both expense ratio and management fees are close to IWDA’s.

Anything I should be weary of like withholding tax? Thanks
 
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BBCWatcher

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I think I saw a post that you recommends prudential? Prudential has the highest premiums if I’m not wrong....
Prudential has solid plans (private and public hospital A ward; no "as charged" public hospital B1 ward plan unfortunately). As with all Integrated Shield plans, premiums are not guaranteed. I wouldn't focus at all on today's premiums except as a tie breaker. (As Aviva's Integrated Shield policyholders can tell you.)

Are VDEM and 2801:HK a good choice if I want to overweight on China? Both expense ratio and management fees are close to IWDA’s.
No. VDEM invests in stocks listed in "emerging economy" stock markets. Currently that means less than half of VDEM (43.5% as I write this) is invested in stocks listed in China (58% if you're including Taiwan). At least 42% of the fund is non-China-listed, so VDEM would be a very inefficient way to overweight stocks listed in China.

If you want Vanguard then you'd probably look at 3169 (or 9169 for the U.S. dollar variant) listed in Hong Kong. It has a higher management fee at 0.40%/year, though.

2801 currently holds 564 stocks while 3169/9169 currently holds 858. Is that ~300 stock holding difference worth a 0.40%/year fee (versus 0.20% for 2801)? It's up to you.

I don't think you should overweight any geography or sector with the possible exception of something involving your planned retirement country.

Anything I should be weary of like withholding tax?
Probably not for either of these funds assuming you're a resident of Singapore and not subject to any other country's tax jurisdiction (not a U.S. person for example).
 
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