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List of Territorial Tax Countries with formal and de-facto treatment of foreign income

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Thanks for the answer. Even if you could 'get away' with︃ it I would probably not do it. I feel like at some point it's not︄ worth the possible fines (or even legal consequences) of not paying your taxes.

By passive︅ income would it be considered capital gains from stocks? I guess sports betting income wouldnt︆ be considered passive income?
 
Yes! That's exactly what‍ I am trying to explain in this forum for years already. Pay what is due.⁠ No tricks.
Capital gains⁣ from stocks are considered passive income in the Philippines, if the company is not "majority"⁢ owned by you and you do not do it for a living (i.e. professional trading).︀
For a resident alien this means that such capital gain is considered foreign sourced income,︁ if stocks are traded/bought/sold on a foreign stock market and are not Philippine companies.
If, as a resident alien, you trade local stocks and/or have income in the form of︂ local dividends, such passive income will be taxed as if you were a resident citizen.︃

Betting is not considered passive income.
 
Could you elaborate on that as a person who is not︃ a citizen of the Philippines (that is, someone who is defined as an alien), regardless︄ of whether the person is a resident or a non-resident, is taxed ONLY on the︅ individual's income from Philippines sources. Likewise, non-resident citizens are taxed only on their income from︆ Philippines sources.

There are plenty of foreigners and Filipino who receive a foreign income and︇ don't pay taxes, as long as you make sure you are not working in an︈ office or for a local business the risk will be very low. Even local immigration︉ head confirmed that if you work from home and not do local business there is︊ no issue.

Many foreign business owners here even don't have a work permit and act︋ just as shareholder, while in fact they are all the time present in their business︌ (but not doing any work, just get income). I wouldn't recommend that but if you︍ are in Philippines and don't work for/with any local business you should be fine.
 
The correct wording:
"An alien individual, whether a resident or not a‍ resident of the Philippines, is taxable only on income derived from sources within the Philippines⁠ "
It can not be much clearer. If you perform work in the Philippines, pay⁤ your taxes!
We had that before. Not worth discussing such a point of view.
Whoever that was, he/she is wrong. Check what you⁢ wrote just one sentence before!
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Please use the search function. I posted several links︀ to relevant publicly available info regarding this entire topic. I am tired to post the︁ same stuff over and over!
 
easy interpretation of this: working for a foreign corp is not⁤ a source within the Philippines, since by def that company is not within the Phils.⁣
Will foreign substanceless corps being redomiciled to the Phils by default would be an interesting⁢ question.
 
What you said is so dangerous that i really hope you aren't following your⁠ advice.

The bottom line is that working from within a country makes it local sourced⁤ income.

That's why in the sheet i created there's a column that says "is it enforced?" because there are some countries that don't care like Panama or Paraguay.⁣ The majority of other countries instead will care.
 
Just look up and add some official sources to it⁠ under Notes. If it is such a clear cut thing, its very easy to find.⁤
Especially Philippines being on the enforcement level of Germany justifies at least a few official⁣ info/sources.

That seems more logical and actually reflect reality.
 
I'm not talking about enforecement of the law, i'm talking about the‍ dangerouseness of your definition territorial taxation "working for a foreign corp is not a source⁠ within the Philippines, since by def that company is not within the Phils." since denotes⁤ a misunderstanding of how territorial taxation works.
 
Ok, how does it work?

Im not talking about enforcement of the law either.
Its just not a clear cut answer,⁤ otherwise a local work permit should be easily obtainable that way.
Thats why every aspect⁣ of territorial tax needs official sources to establish a clear picture.
 
This article will explain how territorial taxation works.

While that article talks about Georgia, the principle is true for‌ all territorial taxation countries:

Most foreign income (with limited exceptions) earned while you are in‍ [territorial country] is not considered foreign-sourced.
 
That was my point. Each place is individual and these "limited exceptions" is what⁤ drives value to your document underlined with the respective articles (primary sources ideally).
 
Monaco: I'm too poor

IoM, Sark etc.: Very few tax treaties. Might be a solution‌ on paper, but then again, if the benefits are so limited (due to the absence‍ of tax treaties), it would probably be cheaper to just go with Paraguay or some⁠ other country with residency without tax residency...
 
Not a lot of tax treaties.
But you should add China to the list. Lots‌ of tax treaties and it seems like there's no tax on foreign-sourced income for 6‍ years, and you can reset the clock by traveling out of the country for 30+⁠ days within one calendar year.
 
Man you're never satisfied!‌

What do you mean by "reset the clock"?
 
😎

There's no tax on foreign-sourced income‍ for 6 years after you become tax resident.
Possibly even only if you spend 183+⁠ days per calendar year in China, I'm not quite sure. It seems like you can⁤ be tax resident spending <183 days as well, and then maybe those 6 years wouldn't⁣ even start counting?
Anyway, if you travel outside of China for 30+ days in a⁢ calendar years, before the 6 years have elapsed, you get another 6 years.

https://www.china-briefing.com/news/tax-residency-china-six-year-rule-clarified/
 
why would you need tax treaties if you stay there for 183+ days a year?‌
are you talking about benefits in terms of reduced withholding tax?
 
This or Panama.‌ Territorial, no CFC laws, foreign-sourced income is exempt. No need to file anything.
 
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