Digital nomad tax

[KJK]

The "stateless person" concept is very interesting, if you want to play with the system‌ a little bit. I think there are also a lot of stateless people in Palestine/Israel.‍ Also there are some countries that do not give citizenship even if you lived in⁠ the country for 50 years or if you were born there - so under certain⁤ situations, you may be stateless.

However, I must stress that (as was already mentioned) a⁣ stateless person, a non-resident and a "perpetual traveller" are really three different things.

Can it be used against you︂ later? The fact that you used an "old" tax ID number from your home country︃ even when you aren't a resident there anymore?

 

[fshore]

Yes if you do that to hide your new tax residency But if︁ you don't have a new tax residency then I don't see how that can be︂ an issue. But it might depend on the specific situation and country in question. And︃ it might change in the future with changes in crs.

 

[KJK]

I agree⁤ 100%, thanks!

My concern is that the home country may want to keep its shee....⁣ I mean citizens... as residents under all circumstances.
I also agree it may get more⁢ and more strict in the future, with nation states losing power, they'll try to implement︀ more and more restrictions, especially the EU (USA already does it very successfully).

So even︁ if you break ties with your home country, no family, no business or personal activity,︂ there's no proof you're staying in your home country, you do no activities there etc.,︃ despite all that some bureaucrat from your home country may still say "Oh so you︄ were a resident Thailand or wherever for a year or two but then you came︅ back which means your center of vital interests was all the time at home where︆ your parents live"... Or something like that. I've heard some stories about this (namely for︇ citizens from Finland and Russia) and they seem to make the digital nomad concept almost︈ impossible to reach.

 

[enceladus]

How about this scheme for a digital nomad whose home country requires a tax certificate‌ in a new country before they will stop taxing you?
- Get a permanent resident‍ visa in Paraguay
- Do not stay 183 days, but do stay enough to do⁠ some local (taxable) work, or buy real estate there and rent it out.
- Go⁤ traveling and pay the taxes on your local income for that year

The PR visa⁣ in Paraguay doesn't require a physical presence, so you don't lose your resident status when⁢ you leave. And by filling an income tax report, that should be enough proof for︀ your home country in case they ask.

Thoughts anyone? BTW, what is the practical difference︁ between a tax residency certificate and a tax filling report?

To clarify the above idea:︂ Paraguay doesn't tax your foreign income.

 

[TurnedToRobot]

How and how easy can you get a permanent resident visa in Pataguay? What's the‌ risk involved?

 

[mnschwarz]

It seems many confuse tax residency, permanent residency, citizenship and just residency. This will of‌ course depend on your home country and their laws / views but for the most‍ part:

Where you are legally obliged to pay taxes is your tax residency and this⁠ will often be based on where you live in actuality. Getting permanent residency in a⁤ place like paraguay, panama etc might be easy but it means nothing on it's own.⁣ Permanent residency might however be a requirement for your country, but it is one small⁢ requirement. You have to actually live there if you want to cover yourself. This means︀ having your day to day banking there, a home there, mail goes there etc. I︁ have seriously heard of cases where people got done for not cancelling magazine subscriptions or︂ changing mail addresses etc.

If you don't have any of this or can't prove it,︃ often you will simple be considered a tax resident of your home country, even if︄ you haven't been there for decades. For this reason it's always best to have tax︅ residency somewhere.

On a seperate note, legally if you're in Paraguay for example and performing︆ work online as a digital nomad, you should be paying tax there as the work︇ is performed locally. No one actually does it in reality but food for thought 😉

 

[enceladus]

Hi, I don't want to sound arrogant or anything, but I'm︉ well acquainted with the concept of tax residency. So I invite you to take a︊ second look at my proposition.

For some countries, breaking tax residency is as simple as︋ not overstaying 183 days. That is the case of Brazil, for example. For others, specially︌ in Europe, one has to cut connections so that you can make a case that︍ your home country isn't your "center of vital interests" anymore. You will also be required︎ to demonstrate that you are paying taxes in a new country, like showing a tax️ residency certificate, before your home country will finally "release" you.

Enter Paraguay. Their permanent residency‌ visa comes with a residential address - what address is this is not important now.‍ You get an official paper (doc 1) stating that you live there which you can⁠ show back home. Secondly, you can request a tax ID and pay taxes voluntarily for⁤ whatever local income you have (doc 2). Now, the Paraguayan law also states that someone⁣ is automatically a tax resident after 183 days living there. I am arguing without proof⁢ that even if you don't stay 183 days in Paraguay after leaving your home country,︀ your PR + (doc 1) + (doc 2) are strong enough evidences that you can︁ show in your home country to break tax residency there.

And if you don't agree︂ with my argument (if you don't, please tell me why), one could well stay 183︃ days in the first year in Paraguay, become a tax resident there officially and break︄ tax residency in their home country. Then you could leave and travel freely, knowing that︅ as long as you don't stay 183 days anywhere else, your tax residency will be︆ still Paraguay (and NOT your home country) because you are have permanent residency visa there,︇ you have an official address and that's your new center of vital interests. I hope︈ it doesn't sound too complicated, in reality it's quite simple.

 

[enceladus]

Very easy for Americans and Europeans, not so‍ much for Africans, Arabs and Asians. Investment between $2k and $3k plus a 3 day⁠ trip to Asuncion. Once there you must make a $5k cash deposit to a government⁤ bank to prove your economic capacity. After 6-8 months they mail your ID and you⁣ may come back to get your $5k back. So all in all, 2 quick trips.⁢

The risk of being scammed or dealing with low quality providers is real, but IMO︀ it's low.

 

[Travelasia]

hello

please could you︇ explain how to make it in philippines ?

 

[Mencjusz]

I would also add that⁢ 'center of vital interests' can be very tricky concept. For example, if you own a︀ house in country A and live, work, pay taxes in country B, you need to︁ check if country A have tax agreement with country B. If not, officially, you would︂ have to pay double tax (based on proportionality - if tax in country B is︃ lower than in country A).

I have also observed that having an active bank account︄ in country A can result in tax obligations.

 

[Konstanz]

It will be hard with Paraguay residency. I advise Cyprus non-dom. You⁤ would be EU non resident. It would be easier

 

[nomad999]

I believe IB will take pretty much everyone outside of US blacklist⁠ countries like Iran, North Korea, Venezuela and such.
You need to provide a Tax ID⁤ when you register with IB.

If anyone has more information or experience on Philippines tax⁣ residency I would be interested as well.

 

[JackAlabama]

For Philippines:
Maybe have a look⁤ at HK? they have some brokers there for example: MONEX BOOM - Trade Locally, Invest⁣ Globally or a premium relashionship with one of the local banks if you are ready⁢ to park least 6digits there.

 

[daxbr]

It is also possible‍ do it in longer time frame steps. Get established, age account, change residency.

 

[px1]

Why? Afaik IB allows‍ Paraguay residency.

Also what about if you already opened an IB account (I already have⁠ one), and then move your tax residency to Paraguay? Can you do that for easier⁤ account opening, and would you have to update your identification in IB?