Tax Haven- yes/no?

[hazi]

Hello Members,
As a digital nomad that currently lives in EU, i registered a local company and was considering registering a company in HK in order to start some portfolio of investments. If my HK company is 0% taxed, will i have any issue transferring the funds to another EU country that i am not a tax payer in and buy an apartment for example?
What if i want to buy an apartment and pay for it directly from the HK company?

Thank you.

 

[Martin Everson]

No such thing as digital nomad when it comes to banking and tax. Don't be fooled.

hazi said:
If my HK company is 0% taxed, will i have any issue transferring the funds to another EU country that i am not a tax payer in and buy an apartment for example?
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No. But where are you telling bank you as director and shareholder are living? Will you be changing your address with bank every time you move? What a CRS nightmare that would be unless you bank in a non-CRS country.

P.S Find a tax free place to call your residency and then move around ensuring you meet the tax free countries rules to be considered tax resident. Don't build up problems for your future.

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Please note my posts should not be taken as financial or tax advice. Please seek professional advice in that respect.

 

[hazi]

Martin Everson said:
No such thing as digital nomad when it comes to banking and tax. Don't be fooled.



No. But where are you telling bank you as director and shareholder are living? Will you be changing your address with bank every time you move? What a CRS nightmare that would be unless you bank in a non-CRS country.

P.S Find a tax free place to call your residency and then move around ensuring you meet the tax free countries rules to be considered tax resident. Don't build up problems for your future.
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i currently leave in a country i am not registered as a tax payer in but as it is time to figure out my plan, i wanted to consider getting tax free country for residency that doesn't require physically presence. do you know any?

 

[CyprusLawyer101]

hazi said:
i currently leave in a country i am not registered as a tax payer in but as it is time to figure out my plan, i wanted to consider getting tax free country for residency that doesn't require physically presence. do you know any?
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-Tax free country for residency without physical presence - wow, you defy gravity 🙂 There is no such thing !
There are few jurisdictions which provide lower thresholds for tax residency, like the 60 day rule in Cyprus which you may qualify for if you are not tax resident anywhere else at the moment.
You could of course in conjunction look for a jurisdiction to set up a company which would not tax your portfolio investments profits and then make sure that your country of tax residency would not interfere with any anti-avoidance provisions like the CFC rules or similar.
If you would like to discuss this, let me know and I can PM you.

 

[hazi]

Lawyer101 said:
-Tax free country for residency without physical presence - wow, you defy gravity 🙂 There is no such thing !
There are few jurisdictions which provide lower thresholds for tax residency, like the 60 day rule in Cyprus which you may qualify for if you are not tax resident anywhere else at the moment.
You could of course in conjunction look for a jurisdiction to set up a company which would not tax your portfolio investments profits and then make sure that your country of tax residency would not interfere with any anti-avoidance provisions like the CFC rules or similar.
If you would like to discuss this, let me know and I can PM you.
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hey, yes i would

 

[Martin Everson]

hazi said:
i wanted to consider getting tax free country for residency that doesn't require physically presence. do you know any?
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And what corresponding country is gonna respect any tax certificate presented from a country where you can be tax resident without physical presence. Don't waste your time going this route.

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Please note my posts should not be taken as financial or tax advice. Please seek professional advice in that respect.

 

[daxbr]

Lawyer101 said:
-Tax free country for residency without physical presence - wow, you defy gravity 🙂 There is no such thing !
(...)
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One could also make provisions for countries that do require physical presence but do not have a regime in place to account for it.

 

[CyprusLawyer101]

daxbr said:
One could also make provisions for countries that do require physical presence but do not have a regime in place to account for it.
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Could you elaborate please, I did not quite got it. Thanks

 

[JohnnyDoe]

What's the problem with all those crypto millionaires? Just move to a no tax country. Buy a beachside mansion and do your crypto stuff on your hammock while sipping a cocktail.
Don't be cheap.

carlo39 said:
What's the problem with all those crypto millionaires? Just move to a no tax country. Buy a beachside mansion and do your crypto stuff on your hammock while sipping a cocktail.
Don't be cheap.
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Alternatively: Italy offers a €100k flat tax. You don't need to declare your assets, and it covers all your foreign income.

daxbr said:
One could also make provisions for countries that do require physical presence but do not have a regime in place to account for it.
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You will eventually get caught by the country where you physically reside. In absence of which, by your country of citizenship.

Last edited: Dec 31, 2021
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[wellington]

carlo39 said:
What's the problem with all those crypto millionaires? Just move to a no tax country. Buy a beachside mansion and do your crypto stuff on your hammock while sipping a cocktail.
Don't be cheap.


Alternatively: Italy offers a €100k flat tax. You don't need to declare your assets, and it covers all your foreign income.


You will eventually get caught by the country where you physically reside. In absence of which, by your country of citizenship.
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-> Got a link to this?

 

[JohnnyDoe]

wellington said:
-> Got a link to this?
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If there was one, official from the government, presented in a nice website and advertised in fairs around the world, thousands of people would apply. But like everything else in Italy simple things are made so difficult.
The official source is law 11.12.2016, n. 232. Not easy to understand. You can find the law in the gazzettaufficiale website.
If you are interested you should contact an accountant and ask to assist. The process is pretty simple but you can't handle it yourself: your accountant submits a request for approval, and if accepted it remains valid for 10 years. The basic condition is that you must not have resided in Italy for the past 10 years. Every year you file a 2 pages tax return and pay the flat tax.
Annual accountant fees are 5000 Eur, maybe you can find one who charges less but better not be cheap.

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[Martin Everson]

wellington said:
-> Got a link to this?
Click to expand...

The Italy non-dom scheme was one I looked into. It is actually a very decent scheme if you can afford the 100k euro a year fee..a crypto millionaire can do so. Even Italians who have not been resident in Italy for a certain amount of time can return under the scheme. My only concern when I looked into it years ago was they could abolish it overnight with a new government and that the scheme only lasts 15 years 🙁. The Gibraltar Catergory 2 residency sounded better and is cheaper but now after brexit not so exciting either. I have discussed both in other threads.

https://www.dlapiper.com/it/italy/i...-tax-incentives-for-attracting-human-capital/
----- quote start

"Res-non-Dom" regime​

Starting from 2017, high-net-worth individuals that want to relocate their tax residency in Italy can opt for a substitutive taxation equal to EUR100,000 on a yearly basis with reference to all foreign-sourced (non-Italian) income (only the proceeds from sale of qualified shareholdings made during the first five years after the relocation are excluded).

The regime applies if the taxpayer has not been an Italian tax resident during at least nine out of ten years before the first year in which the applicant relocates tax residency to Italy. If this condition is met, the regime grants a fifteen-year exemption from individual income tax (IRPEF) on foreign source (non-Italian) income subject to the payment of a yearly EUR100,000 substitutive tax, which however does not contemplate a tax relief on taxes paid abroad.

Moreover, the new resident shall not be subject to Italian wealth taxes (i.e. IVIE and IVAFE) on foreign assets for the entire regime duration and to the ordinary reporting regime for foreign assets set forth under Italian law (RW Form). Inheritance and gift taxes will not be applicable to foreign assets held by the new Italian resident, while Italian assets will be taxed normally.

The application of the regime is also granted to the applicant's relatives who relocate to Italy. They are subject to a substitutive tax equal to EUR25,000 on all foreign-sourced (non-Italian) income received.

The option for the regime can be made (i) directly within the income tax return or (iii) by filing an advance ruling request before the Italian Revenue Agency (suggested option).

---- quote end

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Please note my posts should not be taken as financial or tax advice. Please seek professional advice in that respect.

 

[wellington]

Martin Everson said:
The Italy non-dom scheme was one I looked into. It is actually a very decent scheme if you can afford the 100k euro a year fee..a crypto millionaire can do so. Even Italians who have not been resident in Italy for a certain amount of time can return under the scheme. My only concern when I looked into it years ago was they could abolish it overnight with a new government and that the scheme only lasts 15 years 🙁

https://www.dlapiper.com/it/italy/i...-tax-incentives-for-attracting-human-capital/
----- quote start

"Res-non-Dom" regime​

Starting from 2017, high-net-worth individuals that want to relocate their tax residency in Italy can opt for a substitutive taxation equal to EUR100,000 on a yearly basis with reference to all foreign-sourced (non-Italian) income (only the proceeds from sale of qualified shareholdings made during the first five years after the relocation are excluded).

The regime applies if the taxpayer has not been an Italian tax resident during at least nine out of ten years before the first year in which the applicant relocates tax residency to Italy. If this condition is met, the regime grants a fifteen-year exemption from individual income tax (IRPEF) on foreign source (non-Italian) income subject to the payment of a yearly EUR100,000 substitutive tax, which however does not contemplate a tax relief on taxes paid abroad.

Moreover, the new resident shall not be subject to Italian wealth taxes (i.e. IVIE and IVAFE) on foreign assets for the entire regime duration and to the ordinary reporting regime for foreign assets set forth under Italian law (RW Form). Inheritance and gift taxes will not be applicable to foreign assets held by the new Italian resident, while Italian assets will be taxed normally.

The application of the regime is also granted to the applicant's relatives who relocate to Italy. They are subject to a substitutive tax equal to EUR25,000 on all foreign-sourced (non-Italian) income received.

The option for the regime can be made (i) directly within the income tax return or (iii) by filing an advance ruling request before the Italian Revenue Agency (suggested option).

---- quote end
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True... but... 100k liquidate all assets, then move elsewhere with them being considered tax free... Unless ofcourse you are moving back home and the rules on cap gains within x yrs of pre-return.

I guess the other question.

Once you've liquidated all assets and have paid the 100k... could you then revert to a traditional arrangement... as you have no new cap gains of size.

 

[Martin Everson]

wellington said:
Once you've liquidated all assets and have paid the 100k... could you then revert to a traditional arrangement... as you have no new cap gains of size.
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Yes you can.

btw. Expert I spoke to on the program advised keeping offshore assets in a non-CRS country as the Italian tax office is inefficient and may not realise your initially under the program and try and hit you with issues. He said much cleaner for them to see none of your offshore assets which sounds like a bad omen if you ask me...lol.

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[wellington]

Martin Everson said:
Yes you can.
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Sounds perfect, whats the catch?

 

[Martin Everson]

wellington said:
Sounds perfect, whats the catch?
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Your late paying the 100k because money was blocked at epayments for 2 damn years (lol) then you go onto normal worldwide taxation. The program also only lasts 15 years. Plus 100k is a lot of bread for some people. They could also tweek the program to your disadvantage or abolish it.

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[JohnnyDoe]

Martin Everson said:
Your late paying the 100k because money was blocked at epayments for 2 damn years (lol) then you go onto normal worldwide taxation. The program also only lasts 15 years. Plus 100k is a lot of bread for some people. They could also tweek the program to your disadvantage or abolish it.
Click to expand...

The major risk is that they abolish it. Which would be plain stupid, as its aim is to attract people that otherwise would not come to Italy. But yes some smart politician might decide to do it:

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[JonnyS]

carlo39 said:
The major risk is that they abolish it. Which would be plain stupid, as its aim is to attract people that otherwise would not come to Italy. But yes some smart politician might decide to do it:

View attachment 3075
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curiously I am Italian but I want to leave. It was already a country where it was difficult to do business and with absurd taxes, now it is also becoming a true dictatorship. which countries would you suggest to consider for crypto cash out ? no nazivax country pls

 

[JohnnyDoe]

JonnyS said:
curiously I am Italian but I want to leave. It was already a country where it was difficult to do business and with absurd taxes, now it is also becoming a true dictatorship. which countries would you suggest to consider for crypto cash out ? no nazivax country pls
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Bahamas, or any Caribbean country

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@JohnnyDoe ”“ Your #1 Source for Guidance in Different Offshore Fields​

 

[backpacker]

JonnyS said:
curiously I am Italian but I want to leave. It was already a country where it was difficult to do business and with absurd taxes, now it is also becoming a true dictatorship. which countries would you suggest to consider for crypto cash out ? no nazivax country pls
Click to expand...

Georgia is probably a good option for you.