American financial adviser Robert Levitt has set up an investment management business in France called Levitt Capital Management.
The company will serve US expats and green card holders in the country, as they face several issues and restrictions when accessing financial services due to the Foreign Account Tax Compliance Act (Fatca).
Levitt, who has been living in France for over 15 years, said his Nice-based company is likely the first of its kind, focusing solely on American expats.
“The banks sell products for French nationals and brokers won’t take an American because of both Fatca regulations and the liability of failing to understand the US tax code, which penalises European investment products,” he added.
Additionally, many US-based financial services companies have started turning away non-US residents and forcing their existing clients to move their accounts, as they would run into issues with European regulators otherwise.
‘Tricky’
Levitt continued: “The response I’m getting from clients is really good. With Brexit, companies in the UK no longer service France.
“The key is to take advantage of the tax treaties because a US citizen is taxed in both countries. So, we pick the country with the most favourable taxation. The tax treaty for France is different from other countries, so it’s important to have an expertise by country. Individuals also need US tax reporting information, which is normally not provided by French firms.
“If an American buys European financial products, they are penalised by the IRS. If they buy American products such as ETFs and don’t do it right, the vendors or brokers who sold the products are penalised by the Europeans. It’s tricky.
“If you go to a bank, there’s no tax reporting, so no-one keeps track of capital gains and dividends and people are taxed at the highest rate,” he warned.
There are an estimated 250,000 US citizens living in France who need financial planning and investment management, Levitt added.
The financial adviser previously set up Levitt Capital Management LLC in Florida, which manages around $500m (£415m, €464m) of client assets.
