How to collect forex profits and not have to pay taxes or just a minimum tax?
- Thread starter icedee
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You are doing well from the graphic you showed. However, most banks will reject your business if you are not licensed. I know from various occasion that banks require a license for such activity or a well written and very details business description and plan as well as supporting documents.
If you already sorted that part out there is nothing more to say about it. Using a offshore company to receive profits from your current setup may work but it requires professional assistance in the other end (the offshore company) the tax authorities today are as smart as most of us here on the forum︀ are so you need to think even more out of the box to get this︁ work. You want to work with a lawfirm or agency firm which you can look︂ into the eyes and speak with and that has a real business with staff etc.︃
If you already sorted that part out there is nothing more to say about it. Using a offshore company to receive profits from your current setup may work but it requires professional assistance in the other end (the offshore company) the tax authorities today are as smart as most of us here on the forum︀ are so you need to think even more out of the box to get this︁ work. You want to work with a lawfirm or agency firm which you can look︂ into the eyes and speak with and that has a real business with staff etc.︃
If that is annualized and you are making 1.8 million usd a year, then you should probably just get a real accountant/lawyer than a forum.
If you are doing high frequency trading rather than just investing you might need a full on trading/brokers license.
The jist of it would be to keep your company that does the trades outside of the country including its accounts, same principles as before apply.
Your business can be done location independent, you︀ don't need to be in the EU to run your business trading money.
If you are doing high frequency trading rather than just investing you might need a full on trading/brokers license.
The jist of it would be to keep your company that does the trades outside of the country including its accounts, same principles as before apply.
Your business can be done location independent, you︀ don't need to be in the EU to run your business trading money.
Hi icedee!
Czech Republic is in the EU one of the best places to be as a trader. Low income and corporate taxes!
Leverage of 1:500 is only offered outside the EU.
Well I know of only 3 possible ways to reduce your taxes:
1) Panama, Swiss or Liechtenstein trust and the trust owns everything and you have a minimal salary.
2) Cyprus company with full office and some staff
3) Cryto brokers and you have your account in e.g. Bitcoins and your profit will be in cryto currencies
But please ask an expert!
@Admin: If you trade for yourself and do not offer your service to others you do not need a licence.
If you trade as a private person it is easier to get a bank account. As a company I would︀ recommend EMI`s.
BTW icedee, I am also a trader and your trading screen is impressive!!!︁ ns2
May I ask why do you use so many indicators as you trade a combination︂ of price action and elliott waves!?
Czech Republic is in the EU one of the best places to be as a trader. Low income and corporate taxes!
Leverage of 1:500 is only offered outside the EU.
Well I know of only 3 possible ways to reduce your taxes:
1) Panama, Swiss or Liechtenstein trust and the trust owns everything and you have a minimal salary.
2) Cyprus company with full office and some staff
3) Cryto brokers and you have your account in e.g. Bitcoins and your profit will be in cryto currencies
But please ask an expert!
@Admin: If you trade for yourself and do not offer your service to others you do not need a licence.
If you trade as a private person it is easier to get a bank account. As a company I would︀ recommend EMI`s.
BTW icedee, I am also a trader and your trading screen is impressive!!!︁ ns2
May I ask why do you use so many indicators as you trade a combination︂ of price action and elliott waves!?
I wonder why exactly you work as a "public servant", in some dumb Czech office (not tax office I presume - so let's say healthcare, law, whatever) and at the same time you're making $5k per day with Admiral Markets with a 500:1 margin.
I think paracool's solutions are good, if you want to stay in your home country, old-school offshore company won't help you.
I think paracool's solutions are good, if you want to stay in your home country, old-school offshore company won't help you.
UK spreadbet account .. tax free if it's not your main source of income... only available to UK residents
Nice thread here. I live in Czech republic as well.
The tax system is nice, you're right, I don't have problem to pay 15% on personal income and 19% on corporate income. I even do not have problem to pay 15% on dividends. I do all that regularly and pay X0.000 EUR in taxes.
The only problem I have is once I will invest my already taxed money to trading US ETF/Stocks/Futures/Forex or whatsoever and want to keep the︀ profits reinvested for long run. I understand the fact that in the future I shall︁ pay the taxes once I will collect the profits to buy the Porsche, flat TV︂ or ranch.
But if I want to invest the excess funds, the profit from trading︃ is classified each year as other personal income, which is obviously not (as 100% of︄ the funds are reinvested) and I have other sources of income (ie my business) covering︅ my life expenses. Then it is taxed 15% as personal income.
Is there cost efficient︆ solution for this? For example for trading profits X0.000 EUR? Like to estabilish a shell︇ company (without employees like in Cyprus), do not touch the profits and let it roll?︈ And where for trading US markets for EU residents it is the best? I have︉ been experimenting with offshores with the experience that you can only open the bank account︊ in the not very respected banks and if they go blacklisted by uncle Sam, you︋ will probably loose your savings too.
The tax system is nice, you're right, I don't have problem to pay 15% on personal income and 19% on corporate income. I even do not have problem to pay 15% on dividends. I do all that regularly and pay X0.000 EUR in taxes.
The only problem I have is once I will invest my already taxed money to trading US ETF/Stocks/Futures/Forex or whatsoever and want to keep the︀ profits reinvested for long run. I understand the fact that in the future I shall︁ pay the taxes once I will collect the profits to buy the Porsche, flat TV︂ or ranch.
But if I want to invest the excess funds, the profit from trading︃ is classified each year as other personal income, which is obviously not (as 100% of︄ the funds are reinvested) and I have other sources of income (ie my business) covering︅ my life expenses. Then it is taxed 15% as personal income.
Is there cost efficient︆ solution for this? For example for trading profits X0.000 EUR? Like to estabilish a shell︇ company (without employees like in Cyprus), do not touch the profits and let it roll?︈ And where for trading US markets for EU residents it is the best? I have︉ been experimenting with offshores with the experience that you can only open the bank account︊ in the not very respected banks and if they go blacklisted by uncle Sam, you︋ will probably loose your savings too.
Check this research: Czech Republic: Tax proposals expected in 2020
I'm no expert but from︋ what I read it looks like:
- tax above certain amount is not 15 %︌ but 22 % (15 % + 7% solidarity tax above €60k)
- tax on dividends︍ cannot be avoided in any way I can imagine, sorry
- when trading stocks or︎ forex as a resident, you should again pay 15 % (or 22 %) on your️ profit, with the exception being if you are holding stock for longer than 3 years (according to the paper this used to be 6 months but now it's 3 years)
I'm no expert but from︋ what I read it looks like:
- tax above certain amount is not 15 %︌ but 22 % (15 % + 7% solidarity tax above €60k)
- tax on dividends︍ cannot be avoided in any way I can imagine, sorry
- when trading stocks or︎ forex as a resident, you should again pay 15 % (or 22 %) on your️ profit, with the exception being if you are holding stock for longer than 3 years (according to the paper this used to be 6 months but now it's 3 years)
That's almost correct.
The solidarity tax 7% is only applicable to the income from salary and business. This is fine as long as you have the option to use flat expenses (60% of income in many of the cases) and your real expenses are low.
For trading/capital gains there is only 15%, not +7%. There is a discussion they will raise this to 19% in exchange for something, but it's not finalized yet.
There is time test and you qualify for 0 capital taxes if you hold stocks for 3+years. (which is not my case as I need to rebalance portfolio monthly)
You still have︀ the possibility to invest thru some corporation, do the rebalance there and after 3 years︁ of holding the company, then you can sell the company for free. The question is︂ where is optimal/efficient to set up such corporation as the world gets crazy and as︃ I understand they could claim the profit from such operations as to be yours not︄ the corporation's if you do it alone and do not have the structure.
The solidarity tax 7% is only applicable to the income from salary and business. This is fine as long as you have the option to use flat expenses (60% of income in many of the cases) and your real expenses are low.
For trading/capital gains there is only 15%, not +7%. There is a discussion they will raise this to 19% in exchange for something, but it's not finalized yet.
There is time test and you qualify for 0 capital taxes if you hold stocks for 3+years. (which is not my case as I need to rebalance portfolio monthly)
You still have︀ the possibility to invest thru some corporation, do the rebalance there and after 3 years︁ of holding the company, then you can sell the company for free. The question is︂ where is optimal/efficient to set up such corporation as the world gets crazy and as︃ I understand they could claim the profit from such operations as to be yours not︄ the corporation's if you do it alone and do not have the structure.
Does this still hold true?
1. Panamanian Trust (owns everything) and Minimal Salary
2. Trading for yourself does not require a license (in Panama)
3. EMI is recommended for Panamanian Trust
I'm looking for my Italian friend who resides in Ecuador and trades Forex. At this time, Ecuador would require a 10% Capital Gains Tax.
To avoid any taxes, I'm looking at︀ a corporate structure similar to above. If a Panama Trust would not need a Forex︁ License for trading yourself (no servive offering) and there is no taxation, the next hurdle︂ would be Banking ... which would need to be forex and crypto friendly (with a︃ debit card). Is this viable?
Note: If this setup required a residency card, then that︄ could be arranged, as Panama and Italy have a treaty for instant permanent residency.
1. Panamanian Trust (owns everything) and Minimal Salary
2. Trading for yourself does not require a license (in Panama)
3. EMI is recommended for Panamanian Trust
I'm looking for my Italian friend who resides in Ecuador and trades Forex. At this time, Ecuador would require a 10% Capital Gains Tax.
To avoid any taxes, I'm looking at︀ a corporate structure similar to above. If a Panama Trust would not need a Forex︁ License for trading yourself (no servive offering) and there is no taxation, the next hurdle︂ would be Banking ... which would need to be forex and crypto friendly (with a︃ debit card). Is this viable?
Note: If this setup required a residency card, then that︄ could be arranged, as Panama and Italy have a treaty for instant permanent residency.
Things changed for sure but Panama regulations are still︃ the same:
1) If you trade like once a week you do not trade like︄ a professional and you could trade privately in Dubai, Portugal, Panama, Cyprus, etc. without paying︅ capital gain tax as long as your broker account is outside of these countries.
If you are a Daytrader you should trade in a company located in a country with︆ low dividend tax and live in a country/city with low income tax like Dubai.
1) If you trade like once a week you do not trade like︄ a professional and you could trade privately in Dubai, Portugal, Panama, Cyprus, etc. without paying︅ capital gain tax as long as your broker account is outside of these countries.
If you are a Daytrader you should trade in a company located in a country with︆ low dividend tax and live in a country/city with low income tax like Dubai.
You mean you still setup a Panama Trust which holds the shares in a company incorporated in one of the countries you mentioned?
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