[비즈한국] For the younger generation, overseas stocks are no longer an option but a necessity. Checking the U.S. stock market trends on smartphones every night is a common sight among office workers. However, as the year-end approaches and the focus shifts from how much you 'earned' to how much you can 'keep,' many investors are often taken aback by a heavier tax burden than expected. This is due to the capital gains tax on overseas stocks.
There are many cases where a portfolio shows a rising trend on a return chart, but the actual amount remaining in the account falls short of expectations. It is highly likely that this is not because the stock selection was wrong, but because the tax calculation method is structurally disadvantageous.
What overseas stock investors must know is that capital gains tax is levied based on the amount calculated by the brokerage's system, not on the 'actual profit realized by the investor.'
The core lies in the method of calculating the acquisition price—in other words, the cost basis. The most widely used method by domestic brokerage firms is 'FIFO (First-In, First-Out).' This method assumes that the stocks purchased first are the ones sold first.
Investors who have repeatedly purchased stocks that have trended upward for a long time, such as Nvidia or Apple, can be significantly affected by this method. This is because stocks bought years ago at a low price are calculated as having been sold first, which can increase the taxable gain regardless of the actual realized profit. As a result, the tax burden can end up much higher than expected.
On the other hand, applying the 'moving average method,' which uses the average purchase price of all held stocks as a baseline, can sometimes alleviate the tax burden.
Many investors accept the results calculated by their brokerage firm as they are, but this is not necessarily the most favorable method for the investor. Brokerages apply the FIFO method for the efficiency of their system operations and do not consider individual investors' tax burdens.
This is especially true for employees of foreign companies who have received RSUs (Restricted Stock Units) or participated in ESPPs (Employee Stock Purchase Plans); for them, overseas stocks are more than just investment assets—they are part of their salary and the result of long-term compensation. Problems arise during the 'transfer' process of moving these stocks from an overseas brokerage account to a domestic one. In this process, the acquisition price is often not accurately reflected or is processed as a placeholder value.
There are cases where the acquisition price of stocks deposited into a domestic brokerage account is left blank or displayed as nearly 'zero won.' Instances where the reference price on the day of the transfer, rather than the actual price at the time of purchase or grant, is temporarily entered have also been confirmed. If stocks are sold in this state, the capital gain can be overstated, leading to an unnecessary tax burden. It is advisable to check whether the acquisition price matches the actual cost before selling and to go through a correction process if necessary. To do this, it is important to keep records such as stock grant statements, overseas account transaction histories, and the stock price and exchange rate data at the time of purchase or vesting. Record-keeping is a fundamental prerequisite for overseas stock investment.
Another factor to check before year-end is 'tax-loss harvesting.' Overseas stocks are eligible for a basic deduction of 2.5 million won on capital gains annually. If you made a profit of 10 million won on stock A and a loss of 5 million won on stock B, selling both stocks to net out the gains and losses will reduce your taxable income to 5 million won. Tax is then levied only on the amount exceeding the 2.5 million won deduction.
However, capital gains on overseas stocks may be attributed to the year in which the 'settlement date (date of payment clearance)' falls, not the contract date. At the end of the year, it is necessary to advance the selling date by considering the settlement cycle and market holidays. Since the last possible trading date can vary each year, it is safer to check the year-end settlement schedule announced by your brokerage firm.
For investors preparing for next year, it is more important to review their account settings than to look for new stocks. Simply checking the brokerage's calculation method, ensuring the acquisition cost is accurately reflected, and determining how to utilize this year's losses can make a significant difference in actual returns. In investment, 'calculation' is not just a post-processing matter, but a core element of protecting your assets.