Ruslan Kaymanov
While studying the Russian securities market and immersing myself in the “Depository-Client-Broker” interaction scheme, I came up with a kind of idea of trying to optimize the 13% tax on income received from the sale of securities. Her elegance is captivating. Today I present it to the judgment of experts and ordinary whistleblowers. I’ll try to give an example of the shares of two, perhaps, the most popular issuers - Gazprom and Sberbank. Let me make a reservation right away that we will consider a situation where the market is growing and there is profit, the tax on which we are going to optimize.Let’s say a potential investor has 1 million rubles at his disposal. He must purchase Gazprom shares from a depositary (for example, Gazprombank). The procedure involves filling out several papers: an application to open a securities account (if the client is purchasing shares for the first time) and a purchase and sale agreement for the securities themselves - Gazprom shares. After this, the amount is deposited into the bank’s cash desk and the investor becomes a shareholder of the company. Over time, the package grew, say, to 1.5 million rubles. If the owner of the shares sells them at this stage directly to the depository, then the income tax will be approximately (excluding minor expenses for storing shares, opening an account, etc.) 65,000 rubles. That is, 13% of the difference between the sale and purchase prices (RUR 1,500,000 – RUR 1,000,000). The profit, taking into account the deducted tax, will be 435,000 rubles. But you can do it differently...
Instead of selling shares, these securities can be transferred to another depository. The most convenient way to do this is through a broker. By concluding an agreement with the latter, you receive a personal trading account with a broker and access to electronic trading on the MICEX or RTS platforms, choosing one of them at will or both at once. These services are inexpensive - a few hundred rubles. From the broker, the client receives data from the new depository, to which the securities are transferred. To do this, a special document will need to be drawn up at the sending depository (in our case, the Gazprobmanka depositary) - an interdepository transfer of shares. It is extremely useful to immediately obtain a certificate of account movement, which will be useful when calculating tax and will not allow you to increase the level of the latter. The certificate of completed transfer received after some time is passed on to the broker for the securities to be credited to the new depository and to your personal trading account.
Gazprom shares, now placed in a trading account with a broker, are sold at the market price on the stock exchange. The client receives the same 1,500,000 rubles. For this entire amount (perhaps a little less, so that there are funds left for servicing the trading account), you need to buy Sberbank shares. They need to be transferred to another depository; fortunately, Sberbank has plenty of them in any large city, for example in Rostov-on-Don. This procedure is standard, as described above. At the Sberbank branch nearest to you, you need to ask for the address and details of the depository with which it works and open a securities account there. This usually does not take much time and is inexpensive.
Then the broker needs to send an application for an interdepository transfer of Sberbank shares on the trading account to the depository in which you opened a new securities account. At the same time, the client will receive a certificate from the broker about the quantity, price and purchase amount of shares, in our case, this is, for example, 30 shares at 50,000 rubles per share for the amount of 1,500,000 rubles. This will be necessary later when calculating the tax base. After receiving notification of the receipt of securities in your securities account at the Sberbank depository, you need to give an order to sell the entire block of shares and transfer the entire amount to a bank account. Let's say that the price of Sberbank shares has increased a little by this time and now they cost 50,500 rubles, and our entire package is correspondingly 1,515,000 rubles. When selling a package and withdrawing funds to a bank account, in general, the depositary will most likely already deduct a 13% tax from the amount, although it is possible that this responsibility will be left to the client.
The tax base for the tax on income from the sale of securities will be calculated by the depositary (now we do all business only with him) for the Sberbank shares that we bought on our trading account with the broker. For our example, it will be 15,000 rubles (excluding minor expenses for registration and other procedures) - this is the difference between the amount of sale and purchase: (1,515,000 rubles – 1,500,000 rubles). Thus, the entire 13% tax will be only 1950 rubles. Now is the time to remember what happened in the beginning, when the purchase and sale of Gazprom shares were carried out within the same depository. And there it was - 500,000 rubles in profit and in it 65,000 rubles in the form of a 13% tax on it. As opposed to 515,000 rubles in profit and 1,950 rubles in tax. Obviously, the tax level in absolute terms deserves special attention in these comparisons.
Even with some unfavorable changes in the price of Sberbank shares, losing some positions in profit, the spread in the level of taxes will remain enormous. Moreover, if by the time the entire block of Sberbank shares is sold, they have not changed in price, or have fallen in price and become worth less than the purchase price (less than 50,000 rubles), then we generally avoid income tax, since the profit from the sale of Sberbank shares was In this case, simply not!
The described operations can be schematically depicted as follows.
The purchased shares cannot be touched, as they exist in electronic form. Where and how are they stored, how much does their storage cost, can they disappear? Safety rules are simple, but you need to know them
And investor-broker-exchange: this is what the chain looks like at first glance, thanks to which trading is carried out on the Russian securities market. However, this is not all. The market can be compared to a complex organism, whose life is supported by a number of important organs, which are usually called professional participants. One of the main bodies of the stock market are depositories: roughly speaking, they can be compared to a repository, since the securities purchased by the client are taken into account there. For example, if you entered into a deal to purchase shares on the stock exchange, then it is the depository that will register you as the new owner of the securities.
Nowadays securities are issued mainly in electronic form. Perhaps only bills of exchange exist in paper form, the purchase and sale of which is accompanied by an examination of their authenticity. It's long and expensive. If shares were issued in paper form, then it is obvious that trading them on the exchange, when hundreds of thousands of transactions are concluded per day, would be impossible. Now a share or bond is an electronic record that you are the owner of, for example, 1000 shares of Irkutskenergo. Just as your money is kept in a cash account at the bank, securities are kept in special custody accounts. Thus, depositories these days are not some kind of large safes, but servers with electronic records about the owners of securities.
The document confirming that you are a shareholder is an extract from the securities account, which, like a passbook, indicates how many and what shares you have in your account.
Under the Broker's Wing
Nowadays, most Russian investment companies have their own depositories. When concluding an agreement with a broker, an investor, among other documents, signs a paper on opening a securities account. Before making the first transaction, the broker registers the client in the settlement depository of the exchange: for the MICEX - the National Depository Center (NDC), for the RTS - the Depository Clearing Company (DCC). These depositories provide exchange trading, but the shares will be held in the broker's depository. The procedure for registering a client with the exchange depository takes a business day, so the investor will be able to enter into transactions only the next day after signing an agreement with the brokerage company and its depository.
In addition, depositories interact with registrars (or registrars), who also maintain records of shareholder rights but work for the issuers. That is, under an agreement with the company, they store information about the owners of its securities. Thus, the registrar of Gazprom is SR-DRAGa CJSC, Rosneft is Reestr-RN LLC, RAO UES of Russia is Status CJSC. One registrar can serve a number of companies at once. If desired, a shareholder can keep his shares in the register rather than in the broker's depository. Many shareholders do this, but this is more likely a consequence of the times of privatization: now there are still quite a lot of people who received shares with vouchers and still have not taken any action to sell securities, but only received dividends if the company paid them, and participated in general meeting of shareholders.
A shareholder cannot sell shares listed with the registrar on the stock exchange. In order to make an exchange transaction, an investor needs to enter into an agreement with a broker and transfer the securities to the depository. But it is possible to sell shares held in the register on the over-the-counter market. And with the majority of third-tier securities that are not traded on the exchange market, transactions are concluded this way.
The transfer of securities from the register to the depository takes from one to several business days and will not be free. If we are talking about shares traded on an exchange, then transferring them to a broker makes sense. You will be able to sell Gazprom securities stored in the register on the over-the-counter market, but buyers will offer you a price significantly lower than the exchange price.
It should be noted that in Russia there are many independent depositories that are not part of any investment group. However, the advantages of servicing in a depository under the wing of a broker are obvious. “Firstly, you will actually be served by one company, this will allow you to avoid unnecessary paperwork and save time. Secondly, brokers and depositories working with them are interested in attracting clients, so they often set lower service rates. In addition, it is much more convenient for an investor to store all his securities in one depository, and not with ten different registrars, and at the same time be able to carry out transactions on them,” notes the head of the Brokercreditservice depository. Olga Alekseeva.
However, there is also a flip side to such cooperation. According to the standard agreement, the broker can provide your securities to other clients for margin trading. Thus, shares may be used during the trading day without your knowledge. Of course, the papers will be returned to you, but the fact is that the broker takes a commission for providing papers on credit and, thus, earns extra money for himself.
In addition to their main purpose - recording ownership rights to securities - depositories also provide other services, for example, assisting in the exercise of corporate rights of their clients. Simply put, they become intermediaries between the investor and the issuer: they inform about shareholder meetings, participate in them on behalf of clients and, most importantly, receive and pay dividends on shares. “We receive information about upcoming corporate events, such as shareholder meetings, compile lists of owners of securities that are recorded in our depository, and transmit them to the registrar. That is, we actually confirm to the holder of the registers the right of the owners to the shares. Dividends are also accrued through the depository. Thus, the investor - which is especially important if he owns shares in various companies - does not need to withdraw money from a number of registrars; the funds are transferred to a brokerage account and can immediately be used for new transactions,” notes Olga Alekseeva.
Price-list
As with any services, you will have to pay for depository services. A securities account will be opened for you free of charge, but storing securities on it can become a major expense. Thus, the depositary of VTB 24 bank was going to charge a fee for storing shares in the amount of 0.02% per annum of their market value (at least $2 per month) from investors who participated in the “people’s” IPO. However, due to the social significance of the problem, the bank reversed this decision.
Therefore, when concluding a brokerage agreement, it is necessary to find out the amount of the fee for storing shares in the depository and the cost of servicing when making transactions. The current situation is that most of the largest brokers do not charge money for holding shares if you do not make transactions. It is believed that the cost of depository services is “wired” into the brokerage commission.
If you regularly make transactions on the MICEX, you may have to pay the depositary a certain amount (see table). In addition, settlement depositories - NDC and DCC - charge brokers money for their services, which the brokers themselves, in turn, can transfer to their clients who made transactions during the month.
Tariffs for depositary services of shares
MICEX
| Company | When performing transactions | In the absence of operations |
|---|---|---|
| Alor | 100 rub. per month | For free |
| Brokercreditservice | 177 rub. per month | For free |
| VTB 24 | For free | For free |
| KIT finance | For free | For free |
| Opening | For free | For free |
| Renaissance broker | 11.8 rub. per month | 11.8 rub. per month |
| Troika Dialog | For free | For free |
| Finam | 150/450 rub. per month | For free |
| Zerich | For free | For free |
According to the executive director of IC Zerich Alexandra Shcheglova, now brokers with a large number of clients do not pass on NDC fees to clients. Firstly, they are very difficult to calculate and correctly distribute across all active clients. Secondly, brokers who charge a fixed fee in their depositories compensate for their own expenses for NDC payments. And low deposit fees (or no fees at all) can be a deciding factor when an investor chooses a broker. At the same time, in the tariffs of some of them you can find fees for both storage and transactions. For example, at ITinvest, according to one of the tariff plans, the client will be charged “30 rubles. for changing the net position for each issue of the Central Bank." This means that if you buy and then sell 100 shares of LUKoil during the day, you will not be charged anything, since there will be no change in the account. And if you sell only 30 shares and leave 70, it will cost 30 rubles. According to the same tariff plan, ITinvest will charge you 0.025% per month for storing the value of the shares. If you have shares worth 300 thousand rubles, it will cost 75 rubles. per month.
Money in the morning - chairs in the evening
So, you have entered into an agreement with a broker, opened a securities account, and transferred the funds necessary to purchase securities. What happens next? For example, you decide to purchase shares of a company on the MICEX: you submit a purchase order, conclude a deal with the seller - the papers are yours. However, the shares are actually transferred to your account only in the evening. “At the end of the day, NDC sends to our depository a settlement for transactions concluded in favor of each client. We compare this information with the data received from the broker, after which we transfer the securities to clients’ accounts,” explains Olga Alekseeva. It does not matter how many purchase or sale transactions you made during the trading session: at the end of the day, all data is summed up. If a client bought 100 shares and then sold 90, then, accordingly, 10 securities will be credited to his account.
Settlements between buyer and seller occur somewhat differently if the transaction is concluded on the over-the-counter market, for example on the RTS Board or on the classic RTS market. “If settlements for a transaction concluded on the exchange market are carried out before the end of the day, then on the over-the-counter market there are standard settlement periods - three plus two. That is, on the third day after the conclusion of the transaction, the securities are delivered, and on the second day after the delivery of the securities, their payment occurs,” says Olga Alekseeva.
As for arbitrage transactions, that is, buying shares on one site and selling them on another site, some difficulties arise here. In order to carry out such a transaction, the client must submit an order to transfer securities from NDC to DCC or vice versa. The cost of such a translation can be about 1000 rubles. depending on the number of shares.
Safety first
The large flow of data that is constantly exchanged between participants in the securities market requires appropriate serious protection. To protect information, depositories use an electronic document management system, electronic digital signature and encryption keys. “There are certain requirements for the depository accounting system: information must be copied and protected from external influence. All software used by the depository operates only on the internal network. Securities account statements are issued only in paper form. There are special security marks on the statement itself - these are unique numbers registered in our system. Any statement that has been handed over to the depositor can be picked up and checked by number,” says Olga Alekseeva. In addition, many depositories differentiate the access rights of employees to client information.
At the same time, cases of “shortages” do occur, although depositories, not surprisingly, do not like to talk about them. “As a rule, unauthorized changes to client accounts in depositories occur as a result of staff error or as a result of a software failure,” notes the deputy chairman of the board of directors of the Professional Association of Registrars, Transfer Agents and Depositories (PARTAD) Petr Lanskov. Cases of loss can also occur due to the fault of the depositor himself. The fact is that although the account statement itself is not a security, it should be stored in a safe place. There are known cases where fraudsters, having obtained a document, forged a notarized power of attorney and transferred shares from the account to another depository, and then sold them.
According to Peter Lanskov, usually such disputes are resolved directly between the depository and the depositor, but sometimes it even comes to court proceedings. “In order for the case to become public, the write-off must exceed the capabilities of the depository, that is, be large enough. Otherwise, the archive of transactions is looked up and it is found out at what point and on what basis the shares were written off. If it turns out that the owner of the securities did not order the transaction, the shares will be reimbursed to him by purchasing them on the open market and re-crediting them to his account. In this case, the depositary’s losses can be compensated by insurance coverage under its professional liability insurance contract,” adds Petr Lanskov.
Interestingly, in Russia, unlike most developed countries, there is no structure of the Central Depository (CD), which would collect and store information about all owners of securities. This topic has been discussed for many years, various options for creating a CD are being discussed, but so far everything remains only in words. At the same time, according to participants in the securities market, thanks to the Central Depository, a number of problems would be solved: in particular, the settlement procedure for transactions would be simplified, which would increase their security and reduce the cost of services for investors.
Source: "D`" No. 4 (43) / February 25, 2008
Most often, clients change brokers due to personal preferences, technical failures, high commissions and negative reviews in the press, large brokerage companies told RBC. How to choose a new broker and transfer your account to him?
Photo: Alexey Kudenko / RIA Novosti
To find out what clients are usually not satisfied with in broker services, an RBC correspondent spoke with representatives of the five largest brokerage companies with the highest turnover based on the results of July 2017. According to the Moscow Exchange, these are FG BCS, Otkritie Broker, Finam, Renaissance Broker and Sberbank. Based on this survey, RBC identified the most common reasons for changing a financial partner to work in the stock market, and also found out how a client can change a broker with minimal inconvenience and costs for themselves.
Why do they change brokers?
All of the top 5 market participants surveyed by RBC agree that in most cases clients change brokers when the quality of service no longer meets their expectations. However, no one provided detailed statistics on the transition of clients to competitors.
The standard set of expectations is a convenient service, a small commission for servicing the account and conducting trading operations, and the reliability of the broker, explains FG BCS expert Ivan Kopeikin. He did not indicate the reasons for clients leaving the BCS Federal Group in his response to RBC’s request.
Dmitry Lesnov, head of the department for work with individuals at Finam Financial Group, noted that since the leaders in the stock market generally have similar tariff policies and a set of services,,> ,> reasons for changing one broker to another are most often related to the quality of service, for example, its speed and technology. According to him, there are defector clients who want to test a new broker, but they usually return. “About 0.5% of the client base is leaving. But then they come back. Plus, as a rule, clients come to us from smaller brokers,” adds Lesnov.
Withdrawal of client funds from a brokerage account, as a rule, occurs if the client achieves his financial goals, says Vladimir Krekoten, Deputy General Director of Otkritie Broker. However, the financier notes that in his company, the appearance of negative publications about Otkritie Bank (part of the holding of the same name) in early August led to a slight increase in withdrawals of funds relative to the usual indicator. At the same time, the frequency of opening new accounts and the volumes of their replenishment have not decreased, Otkritie Broker assures. “This suggests that it is mainly old clients who are susceptible to panic, who, we believe, could have received negative comments from our competitors,” Krekoten explains the behavior of clients around the latest events.
The launch of new services for investments and the emergence of new offers from competitors can also cause a flow of clients to them, says Andrey Shemetov, vice president, head of the global markets department of Sberbank CIB. He claims that in recent months Sberbank has seen an influx of clients from other brokerage companies and attributes this to the emergence of a new investment management application, Sberbank Investor. However, other brokers also have similar mobile platforms. The press service of the financial institution did not disclose the reasons for clients leaving Sberbank itself.
Renaissance Broker CEO Vasily Frolovichev claims that his company did not study the reasons for clients leaving. However, according to him, most often investors change brokerage companies if they find more favorable commissions for conducting transactions on the exchange or have complaints about the broker’s technological infrastructure - trading platforms or applications.
It is impossible to find the ideal financial broker for your financial goals and requirements the first time and forever, according to all the experts interviewed. “What seems right now may not be so after a while. Moreover, each broker works to develop its services and can offer better and more convenient service,” explains Vasily Frolovichev.
How to transfer an account
The procedure for transferring funds from a brokerage account to another company is almost the same for all respondents. It is not necessary to close the old account, since there are no restrictions for investors on the number of open accounts on the exchange, with the exception of individual investment accounts (IIA) - there can only be one. “In this case, to transfer to another broker, you need to open a new IIS and close the old one within 30 days, notifying the tax office,” explains Shemetov.
It is advisable to close an old account (not an IIS) only if the broker charges a commission for maintaining it, adds Ivan Kopeikin. So, in any case (even if there are no transactions), once a month BCS will write off from 177 to 354 rubles. depending on the tariff, “Finam” costs 177 rubles, and “Otkritie Broker” and Sberbank do not charge a fee for maintaining an account. Renaissance Broker charges 5 thousand rubles. However, even for a fee, the old account can be useful, broker representatives say. For active investors, it is important to have a backup trading channel on the exchange if the main broker’s trading platform is intermittent,” explains Frolovichev.
You can withdraw assets from one account to another in the form of cash, or in the form of securities, continues Dmitry Lesnov. “The first is simpler: you don’t need to provide any information from the previous broker to the new one,” he says.
Photo: Oleg Kharseev / Kommersant
An investor who chooses the first option will need to first sell the securities, and then send this money via transfer to another account through his personal account. For withdrawal of funds in rubles from the top 5 brokers, you will not have to pay only FG “BCS” and “Finam” for a ruble transfer; in foreign currency, the commission will be 0.07% of the amount . Otkritie Broker will charge 10 rubles for this operation. for withdrawal of amounts in national currency and 0.15% for withdrawals in foreign currency. Renaissance Broker and Sberbank did not post this data on their websites, and the consultants on the hotline, which RBC contacted for clarification, were unable to provide such information.
In addition, a client who decides to withdraw funds in cash may lose part of his capital, since when selling securities he is deprived of potential income from them, the expert recalls.
If the investor decides to transfer securities to a new account, he will need to receive instructions for withdrawal and deposit from both the old and the new broker. This will have to be done directly at the brokers’ offices or remotely using an electronic signature. In addition, the investor will have to request records from the old broker of the prices at which the securities were originally purchased. “This is so that the new broker correctly calculates the tax on them. Otherwise, if the client decides to sell securities from a new account, he will have to pay 13% (personal income tax) on the entire sale, and not on the difference between the purchase and sale of these securities,” explains Dmitry Lesnov.
Neither large nor small brokers will dare to say what is more profitable - to simply transfer securities or sell them and transfer money. “For example, you should take into account the brokerage commission for withdrawing funds depending on the currency in which this occurs,” says Alexey Kondrashov, head of the client department at Russ-Invest Investment Company. — If the commission is fixed, then you can work with it. If it is a percentage of the amount, then the expense will be more significant. It's one thing to pay 10 rubles. for the withdrawn million, another - 0.1% of it, this is already 1 thousand rubles.”
Also, when choosing a transfer in money or in securities, it is necessary to take into account the movement of the investment portfolio. “For example, if one share was purchased conditionally for 100 rubles, and by the time of switching to another broker it was already worth 200 rubles, then the tax on the difference when transferring in securities will be 13 rubles, and if you sell them to withdraw in money , then the tax will be calculated on the sales amount of 200 rubles, and the result will be 26 rubles. » ,” Kondrashov gives an example.
Which broker is better
The three main criteria that should be followed when choosing a new broker are its reliability, tariff policy and quality of service, says Kopeikin.
You should pay attention to the reliability of the structure first of all, since DIA insurance (up to 1.4 million rubles) does not apply to brokerage accounts, adds Shemetov. The level of reliability and market position, in particular, can be checked in the regularly published ratings of the leading operators of the Moscow Exchange and in the corresponding rating of the National Rating Agency, suggests Krekoten. Additionally, you can follow trader forums, where reviews, especially negative ones, appear very quickly. However, we should not forget about the subjectivity of any reviews, market participants point out. As the main sources of information, experts suggest monitoring the forum of a rating aggregator about brokerage activities, Timofey Martynov’s website for traders and the Banki.ru portal.
Commissions charged by brokers often vary depending on the size of the transaction, so an investor who pays attention to this criterion needs to base his or her investment options, experts say. For example, at Renaissance Broker and Sberbank the brokerage commission for transactions on various markets is 0.01-0.1% of the transaction amount, at FG BCS it is from 0.01 to 0.05%, at Finam it is also less - from 0.01 to 0.04%. And in Otkritie Broker the commission is from 0.01 to 0.2%. It all depends on the tariff plan, which takes into account the investor’s activity, trading volumes (the more, the lower the commission), the platform (exchange, Moscow, St. Petersburg or American) and financial instrument.
On the over-the-counter market, where the transaction is carried out without the mediation of the exchange, the smallest commissions on the transaction amount are from Finam - 0.118% (not less than 1,450 rubles), from Sberbank and Otkritie Broker - 0.17% each (not less than 1,475 rubles .), and the largest - for the financial group "BCS" - 0.236% (at least 1,770 rubles)
An exception to the top 5 brokers is Renaissance Broker. His employee said that the tariffs here would be less competitive compared to the tariffs of brokers who specialize in working with private clients and individuals, since they specialize only in professional clients. General Director Vasily Frolovichev explained that we are talking about high-income clients who make transactions for large amounts daily. This is confirmed by data from the Moscow Exchange: in terms of the number of registered and active market participants, Renaissance Broker was not included in the top 25 for July and previous months. But in terms of trade turnover it took fourth position, having completed transactions worth 99.4 billion rubles. in July 2017.
Also, a fee may be charged for account maintenance and as a broker's remuneration, depending on the volume of transactions completed during the reporting period. “You can compare tariff policies using these parameters, and take the data from the broker’s website, but don’t forget about hidden fees,” says Vladimir Krekoten. According to Frolovichev, price monitoring should be carried out not only when choosing a broker, but also during the service process, in order to make a timely decision to switch to a broker with a more loyal attitude - since prices may change.
The most important factor when choosing a broker is the quality of service, Krekoten is convinced. Moreover, each investor, as a rule, understands this criterion in his own way, adds Andrey Shemetov. “Each client values his broker based on the qualities that he personally considers critical. For example, the convenience of quickly depositing and withdrawing funds from a bank account to a brokerage account and vice versa, as well as the ability to check the status of your investment portfolio from a mobile device and make a transaction,” the financier gives an example.
Ivan Kopeikin advises to inquire in advance about the variety of services provided. For example, is it possible to work with foreign assets, options, as well as a stock trainer or personal consultant, the financier explains. As a rule, large players try to provide all these services so that the client does not need to turn to other companies for special services, he concludes.
Questions united by a common theme - accounting and storage of shares, optimization of costs when storing shares.
- Good evening, Sergey!
In 2008, I opened an account with the ALOR broker and bought several shares. Performed trading operations approximately once a year.
Since 2013, the broker has introduced a monthly subscription fee of 150 rubles, regardless of transactions. This doesn’t suit me at all, because... The amount of my investment is small.
But, nevertheless, I want to continue investing.
Sergey, tell me what should I do? Is it possible to retain the shares, but refuse the services of a BROKER? Or switch to another one that doesn’t accept subscribers. But to do this, you need to sell shares and buy again, which you wouldn’t want to do.
Is it possible to buy shares without using a broker?
Thank you,
Sorry if the question seems naive.
S.S.:
You can switch to another broker by transferring shares from one depository to another. However, such an inter-depository transfer of shares will cost money (tariffs must be checked with the broker) and will require several steps (first you will have to open an account with the depository of a new broker, obtain the details, and only then transfer shares from the old broker using these details).
It may be easier and cheaper to sell the shares through the old broker and buy them again through the new broker. However, in order to say exactly which method will be in your case, you need to make a simple calculation for a specific case, taking into account not only the broker’s tariffs, but also the possible taxation of profits from the sale of shares when closing positions.
There is another way to avoid subscription fees - transferring shares directly to the issuer’s register, to the registrar (for each issuer of shares this operation will have to be carried out separately, since different issuers have different registrars). In this case, the efficiency of account management will disappear, and you will no longer be able to quickly sell shares on the stock exchange. Therefore, this method can only be recommended for those who buy shares for a very long period, at least several years, or even with the prospect of passing them on to children by inheritance.
- Tell me, which financial instrument does not entail any management fee, brokerage fee, etc.? Interested in long-term investing.
Thank you.
Valentine
S.S.:
As a rule, no current costs arise when storing shares directly in the issuer's register, with the registrar (registrar). In this case, all costs are usually borne by the issuer.
However, this method has its obvious disadvantages, the main one of which is the inability to quickly carry out transactions with the securities you own.
Anticipating the next logical question, how to transfer shares from the depository of a broker or bank to the register of the issuer, I will quote the answer to it, given by the press service of OJSC NK Rosneft and LLC Reestr-RN from the document “Answers to Frequently Asked Questions of Shareholders of OJSC "NK Rosneft" (document format - .pdf)
How to change the place of registration (storage) of shares from a securities account in the bank depository to an account in the register
shareholders?
To transfer shares for safekeeping from the bank depository to the register of shareholders, you must perform the following actions:
- Open a personal account in the register of shareholders of OJSC NK Rosneft by contacting a specialized registrar that maintains the register of shareholders of OJSC NK Rosneft.
- Issue at the bank where you have opened a securities account for accounting (storing) shares, an order to transfer the shares for storage to the register of shareholders.
- Pay for the services of the bank and registrar for the transfer of shares.
Having made a profit on stock transactions, a trader is faced with the need to pay taxes. Taxation of transactions with securities is not a very complicated thing in terms of calculation, but there are some subtleties and ways to minimize taxes.
First, let's look at taxation for investors, i.e. what taxes does the investor pay? and what is the taxable base.
Tax on state and municipal bonds. Coupon payments on state and municipal bonds are not subject to tax.
Dividend tax. Dividend tax is the lowest tax an investor pays. It amounts to 9% of the dividend amount. Typically, the dividend is credited to the account (brokerage or bank) of the shareholder in its pure form, without tax. The tax is paid by the company itself. Thus, if a shareholder was accrued, for example, 1 ruble dividend per share, then the shareholder will receive 91 kopecks for each share.
Other income from transactions with securities are taxed at the rate 13%
.
The tax base is the exchange rate difference between the purchase price and the sale price of an asset (stock, futures, option) minus the direct costs of servicing the account (broker, exchange, depository commissions). Costs such as Internet fees are not taken into account.
It is worth remembering that the investor pays tax only if he made a profit in the period from January 1 to December 31. Moreover, the investor pays the profit if it is not paper, but real, i.e. profit was recorded during the year.
Who pays tax on stock income?
Legal entities, i.e. organizations pay taxes on their own.
Individuals, i.e. investors do not pay taxes on their own, only in some cases. According to the Tax Code, a broker is a tax agent. This means that the broker assumes all tax payment responsibilities. You just need to know that if at the end of the year you go into paperwork (or you transfer papers to another broker) and there is no money in the account to pay the tax, although there was a profit for the period, then the broker will not write off the tax amount as a minus - he just will not pay the tax for you, but will report to the tax information office that the tax could not be withheld. In this case, before April 1 of the next year, you must independently submit tax form 3 personal income tax on income for the current year, which will not be convenient for everyone.
Dividend tax is paid by the company itself. The tax on exchange rate differences is paid by the broker, because the broker is a tax agent.
How to reduce taxes? 6 legal ways
Any investor faces the problem of tax minimization at the end of the year. There are few ways to legally reduce taxes, but nevertheless they exist.
First way. When opening a brokerage account, you should immediately determine which method of calculating the taxable base will be used to calculate your transactions. There are two such methods: LIFO And FIFO. With the method LIFO the last shares purchased are written off upon sale. With the method FIFO– the first.
What does it mean? Suppose that a trader has in his portfolio shares purchased for a long term and periodically he makes speculative purchases of the same shares for a short period. In this case, it will be unprofitable for the trader if, when closing speculative positions, the broker sells shares previously purchased for a long period, i.e. using the FIFO method. The trader needs that when closing speculative transactions, the shares purchased last are sold, and his investment remains untouched, i.e. it requires the LIFO method. The LIFO method is preferable to FIFO for long-term investors.
Unfortunately, the LIFO method is no longer used to account for transactions in financial instruments as of 2010. Now brokers calculate profits only using the FIFO method. This means that if you bought a security for the long term, but you want to make short-term transactions with it, then in order to distinguish between such strategies you will have to have two accounts. One for long-term investments, and the second for short-term investments.
Second way. You should know that d profits and losses from different investments cannot be summed up. It would be logical if the income received from the stock market were summed up, for example, with the loss received from trust management, and thus the tax base would decrease. In practice, it turns out that investors pay taxes only on profits, and losses received from other investments are not taken into account. In fact, it is possible to sum up the profits and losses from trades in publicly traded stocks, and futures and options, the underlying assets of which are indices and stocks.
What to do in such a situation? You can make sure that the maximum number of investments is tied to a single brokerage account, i.e. It is worth opening accounts with one broker. If you have several brokerage accounts with different brokers, then it is worth reducing their number for tax optimization. In addition, some assets, such as shares, bonds and mutual funds, can be purchased from one account on common platforms (on the MICEX).
Third way. When transferring shares from one broker to another, you must take a document confirming the purchase price of shares. If this is not done, then the second broker will consider that the purchase price of the shares is zero and when selling such shares the investor will pay tax on the full amount of the sale, and not on the profit.
Fourth method. If at the end of the year you have made a profit on operations, but there are unclosed unprofitable positions, then it’s worth closing them at the end of the year and buying back the sold shares. Such an operation will reduce the tax base. Just don’t record a loss b O greater than the accumulated profit, otherwise the purchase price of the shares will be low and upon subsequent sale at a higher price you will have to pay tax on the O greater profit.
Fifth method. On January 1, 2010, new rules for accounting for losses came into force. Now loss can be carried forward for 10 years, starting in 2010. That is, if you received a loss in 2011, then you can partially or fully transfer it until 2021. This loss can cover the profit of subsequent periods. Just don’t think that the broker will calculate all losses for past periods for you - you need to declare them yourself to the tax office and then provide them to the broker when you need to reduce the tax base.
Sixth method. Since 2011, two property deductions came into effect, which will be available no earlier than 2016. First deduction: if the shares have been owned for at least 5 years and belong to the innovation sector. The list of such shares has not yet been determined. The second method: if the shares were owned for at least 5 years, they were non-circulating throughout the entire time of their ownership and at the time of sale they were also non-circulating. Such shares can only be bought and sold on the over-the-counter market.
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