There is extensive bahamas info (458 posts) in this thread: http://www.elitetrader.com/vb/showthread.php?s=&threadid=9822 Living expenses are high, but you pay no tax. If you make only $20,000 a year, you better stay home. If you make $100,000 plus a year pack your bags. Basically, take the price of anything you want to buy in Canada in C$, then add 50% to that number, and that is the price in US $ you can expect to pay for something. My rent is $1000 US a month, but I live a 2 minute walk to the ocean. You can live cheap ($600) if you are willing to live inland with the locals. I haven't been there for the summer yet, but I also live in South Beach, and summer there is 90 F every day and 77 F every night for the low, and its humid. But heat does not bother me much, and it beats snow in my opinion. If you are a very profitable trader in Canada, your best bet is to leave and trade from bahamas, especially if you have no wife and kids to consider. Seems more traders are going there now.
Check this out http://www.accountancyage.com/News/1136701 The Organisation for Economic Cooperation and Development (OECD) has claimed it is making headway in chasing so-called 'harmful' tax regimes from the world's statute books, declaring 18 have been scrapped since the year 2000 and another 14 have been reformed. Link: Tax havens exploited by US businesses Following further analysis, 13 of the 47 systems identified as harmful at the turn of the century had been found 'not to be harmful' by OECD officials, leaving just two in the frame. These are Switzerland's so-called 50/50 practice (previously known as the administrative company regime), and Luxembourg's 1929 holding company regime. Both will be discussed at the OECD later this year and, although reforms have been tabled in Luxembourg, the international think-tank has concerns about the system's transparency. The organisation considers tax laws that allow for low or zero taxation on geographically mobile services to be harmful, especially where there is a dearth of information about the taxpayers. The body considers these systems to stymie open tax-competition between jurisdictions. Bill McCloskey, OECD fiscal affairs committee chairman, said pressure from his organisation since 2000 has 'resulted in real change', adding: 'OECD countries have shown that they will take action to ensure that tax competition is fair.'
i think the jewish and arab quarters of jerusalem might be a little closer together than that. never been to bratislava, how does it compare to prague?
Problem I had when considering the Bahamas, and I seriously considered it, is the cap on the foreign earned income exclusion for Americans. Because of the higher cost of living in the Islands you have to make considerably more money to mainain your living standard than stateside. However, if you make over $100k or so the benefit becomes rapidly meaningless because of the cap in the low 80's. If the cap didn't exist I'd be there. Are Canadian citizens capped, or is all foreign earned income excluded from taxation by Canada? If there is no cap and if my country doesn't clean up its foreign policy I'd really consider singing a different anthem and chugging half-frozen strange brew.
Canadians are taxed on their residency, not on their citizenship like an American would be. I could make $100 million per year tax free as long as I am a non-resident of Canada. But its not that simple. To truly be considered non-resident of Canada for tax purposes, you have to be considered a resident somewhere else. You also have to cut your ties to Canada, and not have an intent to return, otherwise you are just on a long vacation. It is not clearly spelled out in the tax code, but the more ties you cut, the stronger your case if they ever challenged you. At the very least, you should not have a house, a job, a free health plan, or a wife and kids living in Canada. If you have those things, you are not really non-resident. I only kept 2 things from Canada, my passport and my drivers license, and I will try to replace the license with a Bahamian one if I can once I get my Bahamas residence permit. I cut all other ties, I don't even have a bank account in Canada anymore.
Thanks for the detailed reply. I've wondered about that for some time after discussing it superficially with a Canadian in Freeport. Really that is a sane and logical way to handle the issue, unlike the imperialistic and controlling American policy of taxing anywhere, anytime, and for any reason.
canadian_dude, Another Canuck here. Congrats on the move! It appears you've got a lot of the initial issues out of the way. Now that you've "settled in" what would you say the future holds insofar as earning income... particularly trading and how you're going to pay your taxes. This affects me directly. Could you pass on a little info as to what broker you've decided on (if there was indeed a change), your platform etc. and any issue you've had w.r.t. getting local banking acct's set up. Will you file a return (4% was mentioned... somewhere?). I find this to be the next hurdle based upon your email in the Bahamas thread. My wife and I have considered the same move due to the fact we're in the same tax bracket (the highest here in Ontario) - I wonder aloud... what would it take for her to set up a dental practice in Bahamas - if indeed she could - and what would the tax advantage be for her/us. I guess buying property is the best way to go as far as "establishing" residency. Probably a good thing that you've applied for residency status. (Can you tell customs that you're going to be staying "on holiday" for 1 month, 6 months, 2 years etc?) Thanks for anything you can offer.
OK, I will try to address some of these points. My attitude is that I no longer live in Canada, and will not be returning to Canada. I have no assets of any kind in canada, and no ties to canada. They have all been cut. I rent an residence full time in Bahamas, have cut up my health card and returned it, and have private medical insurance. I have no ties to Canada, and therefore I feel I have no obligation to file a tax form with the Canadian government. They could challenge me on that if they chose to do so, but I would have an extremely strong case to prove I am non-resident because I researched it extensively before moving. Do not get suckered into filling out that Canadian government form for people leaving the country, you are not legally required to inform the government you are leaving. This advice came from a lawyer of someone I know. That form can only be used against you, it cannot help you. They try to trap you into making statements that they can later use against you that would indicate you are still resident of Canada. You don't have to fill out the form, so don't do it. I use the same broker as before, I use Ffasttrade out of Chicago and I recommend them to anyone. Getting local bank accounts in Bahamas is VERY difficult. And even if you get it, you will be extremely restricted. You have to tell them in advance every time you want to deposit money, they are very strict in trying to prevent money laundering. I didn't even bother getting a Bahamas bank account, its too much hassle. I use my American bank accounts based out of Miami. I suggest you do the same thing. Get a US funds bank account from a US bank in the USA, and use that. It might be tough to get a Florida bank account if you do not have a Florida address though, but its not impossible. Another option is to open your account just across the border in Michigan, NY state, etc while you are still living in canada. Then change the address on the account once you move to Bahamas. Make sure the bank has branches in Florida though unless you want to visit a local branch. Make sure the US bank is willing to offer you a credit card, at least a pre-paid type of pseudo credit card. You will want to cancel your Canadian credit card, and replace it with a foreign one. But you won't get one from the bahamas, you need to get one from the USA. Look into this well in advance, it is a tricky issue, especially if you have no mailing address in the USA. Take my word for it, you don't want a Bahamian bank account, its a huge hassle to open and operate. And everything in bahamas operates in US dollars anyway, its on par. Your wife would have problems opening a dental practice, but its not impossible. Bahamas fiercly protects Bahamian jobs. You have to have skills that cannot be supplied by a Bahamian, and then only after the job has been advertised for locally and not filled. Work permits for foreigners cost $14,000 per year. I don't know what the story is with setting up your own practice. Nothing is impossible, money talks, if you are making an investment in Bahamas and creating a job(s) for bahamians, they might let her open a practice. You would need to talk to a Bahamian lawyer, preferably one well connected with politicians. I know of one who is very well connected, I can tell you who he is if you want to know, but he charges more than others charge. But I guess you pay for the people he knows. Buying property worth $500,000+ is the best and fastest way to get residency. Some of it can be financed. But its actually a $500,000 INVESTMENT, it doesn't all have to be in a house. An investment of $300,000 in a house and $200,000 in a Bahamian business would qualify as a $500,000 investment for residency purposes. Be aware though that many businesses require you have a Bahamian partner. When entering Bahamas, you tell customs you are "on holiday" if you do not have residency status. NEVER tell them you are working or on business, even if you consider trading to be working. Technically the maximum stay for a Canadian is 3 weeks I think, but I have already told them once I would be staying fopr 4 weeks and they didn't say anything, it wasn't an issue. An American can stay for 8 months at a time, but not a Canadian, not unless you have residency. So you go there, tell them you are staying a month, then take the ferry to Lauderdale for a weekend holiday, then come back for another month, etc. You don't want to stay there all the time anyway or you'll get island fever, you'll want to visit the USA once in awhile. OK, I hope this answers some questions.
I wish someone reminded me that, last time I entered Canada. When the officer asked me "how long are you staying" , I told him 6 months (the max for an European tourist ). Man , I thought they were arresting me on the spot. 2 hours in an office to verify my story and contacts in Canada ( they actually called 1 of my resident friends ) . I missed my connection from Toronto to Vancouver etc. Now I'm sure it was their job, anyway I never had a problem before. So next time I'll keep my mouth shut, you can bet! And before someone jumps to a wrong conclusion... I love Canada and Its people! Great advice buddy!