Best Country for Trading (Tax efficiency)

Discussion in 'Taxes and Accounting' started by ET873, Feb 3, 2010.

  1. Armenia is not part of CRS and there are no plans to join for the next few years. No DTA with Portugal either. So Portugal shouldn’t be able to find out.
     
    #1171     Sep 10, 2022
    d08 likes this.
  2. I don’t think either that trading through a company would decrease your tax liabilities significantly. You’re most likely better off by trading as an Individual.
     
    #1172     Sep 10, 2022
    wrbtrader likes this.
  3. I think you are right, I guess the initial question about the best country to trade in, could expand to a few cases where you would choose between a limited company and an individual. That would include better places than Spain for sure.

    I found this report from the CNMV, the Spanish authority that goes into more detail.

    https://www.cnmv.es/DocPortal/Publicaciones/Guias/Guia_Fiscalidad_Acciones.pdf

    The page that goes into detail:

    Screenshot_20220910-222012~2.png

    Which goes to what LuisHK was pointing out. There are a few more levels to consider.
     
    #1173     Sep 10, 2022
    p4trick88 likes this.
  4. If the only factor is where you can save the most money, countries like Thailand, UAE or Argentina will be among the best options. For me however, factors like quality of life, ease of meeting people, language barrier, safety, quality of public institutions and the environment are very important. Especially ease of meeting people and environment. I rather save less for an active social life than to be in a place where its tough to meet people or where the environment/outdoor options are very limited. Spanish/Portuguese cities rank among the best cities in the world for expats according to Internations - the largest expat survey there is. Countries like the UAE, Thailand and Malaysia also perform very well, but I’m someone who likes to be outdoor, rather than being indoor most of the time - which you will be in most South East Asian/ Middle Eastern cities.
     
    #1174     Sep 11, 2022
  5. wrbtrader

    wrbtrader

    Consider this... it's not unusual for business taxes or individual taxes to change with a newly elected government.

    Thus, a country that has a favorable tax rate for a trader today may change to unfavorable for the trader a few years later with a newly elected government.

    Also, hopping around from one country to another country for tax reasons to the most favorable country is typically not advisable and can quickly generate an audit and more headaches / costs to have a tax account well schooled in up-to-date tax info for different countries.

    wrbtrader
     
    #1175     Sep 11, 2022
    p4trick88 likes this.
  6. Germany has no Tax on cryptocurrencies for longterm-capital gains.

    As Saylor likes to say...
    Tax That!
     
    #1176     Sep 17, 2022
  7. otctrade

    otctrade

    yes but if you already on crypto then it's too late to switch countries to avoid tax on those gains... You will have to most likely pay a departure tax to your current country.
     
    #1177     Sep 18, 2022
  8. virtusa

    virtusa

    https://www.oecd.org/tax/automatic-exchange/crs-implementation-and-assistance/crs-by-jurisdiction/

    https://ibkr.info/article/2784

    I hope that you do know that payments with bank cards or credit cards from other (mostly exotic) countries are checked in most European countries. Especially if these cards pop up frequently for payments. Armenian cards that are used frequently in any European country are red flags for the tax administration.

    Are you sure that your money is safe in Armenia???
    This is the answer from somebody who had a bankaccount in Armenia:
    I closed it shortly after conflict broke out. Remember the place is a conflict zone with armed conflict with Azerbaijan. It is not a place to think your money is safe when bits of territory of each country keep swapping hands . You could find your Armenian account is now an Azerbaijan account the next time you log in (I exaggerate here...lol).
     
    Last edited: Sep 18, 2022
    #1178     Sep 18, 2022
  9. Yeah the fact that an armed conflict broke out again within few years with Aserbaidschan is a major drawback.

    Serbia remains an interesting option too. Easy to open a company through which trading is possible. 15% corporate tax only. Not part of CRS and no DTAs with many countries either, especially outside Europe.
     
    #1179     Sep 18, 2022
  10. James63

    James63

    If you are looking for tax efficiency (or tax deferral) then consider a "New Zealand Foreign Trust" - that is a New Zealand trust with a non-NZ resident settlor. The trust will only pay NZ tax on income earned in NZ, so if all income is earned in other countries (e.g. trading US stocks, etc) then there is no tax payable in NZ.
    A lawyer can set up the trust for a few thousand dollars, there is a NZ$270 fee to the tax department to register the NZFT and there are annual disclosure requirements to be filed (i.e. any money paid in or taken out). You will need a NZ resident trustee (at worst a lawyer will to this for about NZ$5000 per year, or make a NZ friend and pay nothing or a lot less).
    If you distribute money from the trust to yourself, that will be taxed in your country of tax residency - but you can accumulate and re-invest income/capital gains in the trust and defer tax forever (or a long time). Or live in a country with a territorial tax system who will not tax you on foreign earned income.
    Also get local tax advice as your country of tax residency may seek to tax you locally on the trust's income as the settlor. Different countries have different rules over who they tax on trust income.
    The advantage of the NZFT is that it is from an OECD, high tax country (although the trust will pay no tax), which is subject to less scrutiny and compliance than a "tax haven" corporate entity!
     
    #1180     Oct 1, 2022