0% plan and coming back from tax haven after 10 years

[zzzzzz]

Let's say you want legally 0% personal tax for the next 10 years but with one foot still in your home country.
Citizenship and current residency is in EU.

Next step: you deregister and cut residential ties, and establish new residential ties and home in tax haven.

Questions:
1. Can you stay legally 182 days in your country of citizenship every year? Like a tourist, no bank account there, no residential ties, paying with cards and cash, living in a house owned by relatives ...etc.?

2. How important is to stay X number of days in tax haven? UAE has 90 days minimum if you rent/own home and want to get TRC. But do you really need TRC if you're already deregistered in your country of citizenship?
What if you plan your year like this:
UAE 94 days
EU country of citizenship 182 days (<183 days limit)
other EU country 89 days (<90 day limit)?

3. Let's say after 10 years of investing and accumulation, your personal brokerage account in USA grows to decent size and you also have all the documents (trading account history, SOF ...etc.).

What can you expect from taxman in your EU country of citizenship when you register back home and next year sees your brokerage account size via CRS?

When does taxman ask for proofs of your past years (card transactions, flight tickets, utility bills, TRC,...etc.)? From what I have read, main targets are people who are still secretly living in their home country or their family is still there (and taxman somehow sees that) or didn't deregister but want to use DTA for the past year to have tax non-resident status.
What are your experiences? @Sols

 

[wellington]

In the UK there's a tax for returning with some sort of incomes/gains within so many years of earning.

 

[zzzzzz]

In the UK there's a tax for returning with some sort of incomes/gains within so many years of earning.

Fortunately in my country of citizenship there is no such tax, one less thing to worry.

Btw. @wellington how exactly do you invest & accumulate tax free and then pay dividend every few years? Do you have some sort of accumulating investment fund?

 

[jafo]

Let's say you want legally 0% personal tax for the next 10 years but with one foot still in your home country.
Citizenship and current residency is in EU.

Next step: you deregister and cut residential ties, and establish new residential ties and home in tax haven.

Questions:
1. Can you stay legally 182 days in your country of citizenship every year? Like a tourist, no bank account there, no residential ties, paying with cards and cash, living in a house owned by relatives ...etc.?

2. How important is to stay X number of days in tax haven? UAE has 90 days minimum if you rent/own home and want to get TRC. But do you really need TRC if you're already deregistered in your country of citizenship?
What if you plan your year like this:
UAE 94 days
EU country of citizenship 182 days (<183 days limit)
other EU country 89 days (<90 day limit)?

3. Let's say after 10 years of investing and accumulation, your personal brokerage account in USA grows to decent size and you also have all the documents (trading account history, SOF ...etc.).

What can you expect from taxman in your EU country of citizenship when you register back home and next year sees your brokerage account size via CRS?

When does taxman ask for proofs of your past years (card transactions, flight tickets, utility bills, TRC,...etc.)? From what I have read, main targets are people who are still secretly living in their home country or their family is still there (and taxman somehow sees that) or didn't deregister but want to use DTA for the past year to have tax non-resident status.
What are your experiences? @Sols

In theory, it could even be done, but in reality/practice it will be questioned and they will make your life a living H3LL until they earn what they think belongs to them.

If I were a real POS unproductive parasite working for the Tax agency/gov,

1. I would see how much you earned in those 10 years, e.g. €10M.
2. If I wanted €5M of that (50%), I would start questioning you and auditing you every year creating taxable events for you where you had to hire lawyers and accountants and other experts...until...
3. You had spent the €10M and I would have earned the €5M (50% of the €10M you spent defending yourself) I believed was mine.
4. I would then "drop" the subject and ghost you.

I grew up "around" people who schemed like that on behalf of their slave masters/overlords.

Caveat Emptor.

 

[zzzzzz]

In theory, it could even be done, but in reality/practice it will be questioned and they will make your life a living H3LL until they earn what they think belongs to them.

If I were a real POS unproductive parasite working for the Tax agency/gov,

1. I would see how much you earned in those 10 years, e.g. €10M.
2. If I wanted €5M of that (50%), I would start questioning you and auditing you every year creating taxable events for you where you had to hire lawyers and accountants and other experts...until...
3. You had spent the €10M and I would have earned the €5M (50% of the €10M you spent defending yourself) I believed was mine.
4. I would then "drop" the subject and ghost you.

I grew up "around" people who schemed like that on behalf of their slave masters/overlords.

Caveat Emptor.

No problem with questions from taxman, the point is to plan everything ahead the right way and have documents, proofs.
With no socio-economic ties (bank accounts, investments, business, wife&kids, real estate...), no permanent residence address, staying less than 183 days, not becoming tax resident again in 3 years after deregistration... I'm just a tourist enjoying sunny day, I guess?

 

[JackAlabama]

Let's say you want legally 0% personal tax for the next 10 years but with one foot still in your home country.
Citizenship and current residency is in EU.

Next step: you deregister and cut residential ties, and establish new residential ties and home in tax haven.

Questions:
1. Can you stay legally 182 days in your country of citizenship every year? Like a tourist, no bank account there, no residential ties, paying with cards and cash, living in a house owned by relatives ...etc.?

2. How important is to stay X number of days in tax haven? UAE has 90 days minimum if you rent/own home and want to get TRC. But do you really need TRC if you're already deregistered in your country of citizenship?
What if you plan your year like this:
UAE 94 days
EU country of citizenship 182 days (<183 days limit)
other EU country 89 days (<90 day limit)?

3. Let's say after 10 years of investing and accumulation, your personal brokerage account in USA grows to decent size and you also have all the documents (trading account history, SOF ...etc.).

What can you expect from taxman in your EU country of citizenship when you register back home and next year sees your brokerage account size via CRS?

When does taxman ask for proofs of your past years (card transactions, flight tickets, utility bills, TRC,...etc.)? From what I have read, main targets are people who are still secretly living in their home country or their family is still there (and taxman somehow sees that) or didn't deregister but want to use DTA for the past year to have tax non-resident status.

thats what it looks like if you stay each year that much home just 1 day short of that magic 183 limit. but you can call your luck.
do it like that: stay away 350 days and go visit for 15 days. You have 2 weeks of vacay like every other corp slave which you spend at home.

What are your experiences? @Sols

 

[freegeek]

The 183 rule is meaningless on its own in a lot of tax jurisdictions, it is just one of the parameters tax authorities use to qualify if you are a tax resident or not. "Substance" and "center of life" are much more weighted then simple calendar days. I can guarantuee you that in your example that you will get in trouble in most (West) European tax jurisdictions if you stay 182 days in your home country while your official tax residence is in UAE. If it was that easy, every freelancer would do this.

 

[Konstanz]

The 183 rule is meaningless on its own in a lot of tax jurisdictions, it is just one of the parameters tax authorities use to qualify if you are a tax resident or not. "Substance" and "center of life" are much more weighted then simple calendar days. I can guarantuee you that in your example that you will get in trouble in most (West) European tax jurisdictions if you stay 182 days in your home country while your official tax residence is in UAE. If it was that easy, every freelancer would do this.

So very true. Many people try to do this and get in trouble because of this.
If you stay 180 days in your home country nobody will believe you emigrated out of your country genuinely.

 

[Larin]

As was mentioned there is no magic 183 day rule. If the country in question is Germany you would absolutely be considered a tax resident if you spend even a week at your parent's place that you continuous access to (as demonstrated by you staying there). De-registering properly and saying away from the country of your citizenship will be key.

Just to add, your question is "can you do it?", but the real question (which seems to be asked quite a lot these days), is "can I get away with doing it?" And 'it' being tax evasion. I don't know, can you get away with breaking other laws?

 

[zzzzzz]

So very true. Many people try to do this and get in trouble because of this.
If you stay 180 days in your home country nobody will believe you emigrated out of your country genuinely.

What is important - laws, facts and proofs or what taxman "feels" in that moment? Taxman can feel whatever he wants, but if you go by the rules, he is just wasting his time and taxpayers money.

 

[freegeek]

What is important - laws, facts and proofs or what taxman "feels" in that moment? Taxman can feel whatever he wants, but if you go by the rules, he is just wasting his time and taxpayers money.

you have no clue what you are talking about, in Belgium people have been considered tax resident because they still have a fitness subscription or a Belgian mobile number. I suggest you go talk with an international tax advisor. The fake domicile what you are describing is the oldest tax avoidance trick in the books, it is also the easiest to get caught.

 

[zzzzzz]

you have no clue what you are talking about, in Belgium people have been considered tax resident because they still have a fitness subscription or a Belgian mobile number. I suggest you go talk with an international tax advisor. The fake domicile what you are describing is the oldest tax avoidance trick in the books, it is also the easiest to get caught.

That is why you cut ties with country of citizenship (no subscriptions, no tel. nr., no bank accounts, no investments, no business, no wife&kids, no car, no real estate, no cat, no dog, no permanent address, no health insurance, tax non-resident status) and become tourist. After that you don't have substance there, but abroad. The only rule that stays after that is the 183 day test.

 

[Konstanz]

That is why you cut ties with country of citizenship (no subscriptions, no tel. nr., no bank accounts, no investments, no business, no wife&kids, no car, no real estate, no cat, no dog, no permanent address, no health insurance, tax non-resident status) and become tourist. After that you don't have substance there, but abroad. The only rule that stays after that is the 183 day test.

Also important to have substance in some foreign country: real estate (rent/buy), local driving license, subscriptions, TRC, residence permit, utility bills etc

 

[zzzzzz]

Also important to have substance in some foreign country: real estate (rent/buy), local driving license, subscriptions, TRC, residence permit, utility bills etc

Yes, agree.

 

[freegeek]

That is why you cut ties with country of citizenship (no subscriptions, no tel. nr., no bank accounts, no investments, no business, no wife&kids, no car, no real estate, no cat, no dog, no permanent address, no health insurance, tax non-resident status) and become tourist. After that you don't have substance there, but abroad. The only rule that stays after that is the 183 day test.

You are so focused on the 183 day rule while it is irrelevant in the scenario you are describing, with your setup your center of life is clearly still in your home country because of social ties so you will be considered tax resident and your UAE domicile will be considered fake and tax evasion. Think about it for 5 minutes, if it was that easy we would not have this forum with all these crazy tax setups. Everyone including me would simply get tax residency in UAE and live 182 days in our home countries, the other days I would be in sunny Spain and I would occasionaly travel back to UAE to check mail. Tom Boonen, a famous Belgian pro cyclists was caught with this, he made millions and had put his tax residence in Monaco. This guy was not even in his home country (Belgium) most of the time unlike you are planning because he was racing all over the world, still he was considered a Belgian tax resident because it was clear his real life was not in Monaco, they caught him because all his anti-doping tests were done in Belgium which the tax man used against him to declare that if he is not racing he was spending his life in Belgium and not in Monaco. Don't believe me here is an article in a Belgian financial newspaper which describes the hundreds of Belgians who are caught every year doing exactly what you are saying. it is in Dutch so use google translate. Fiscus eist 100 miljoen euro van Belgen in Monaco

Also important to have substance in some foreign country: real estate (rent/buy), local driving license, subscriptions, TRC, residence permit, utility bills etc

does not matter, they will use the "center of life" argument against you. This is an article from a Belgian financial newspaper about the hundreds of Belgians who get caught "moving" to Monaco. It is in Dutch so use google translate Fiscus eist 100 miljoen euro van Belgen in Monaco

 

[Cloudbanck]

That is why you cut ties with country of citizenship (no subscriptions, no tel. nr., no bank accounts, no investments, no business, no wife&kids, no car, no real estate, no cat, no dog, no permanent address, no health insurance, tax non-resident status) and become tourist. After that you don't have substance there, but abroad. The only rule that stays after that is the 183 day test.

As other people have said there is more than the 183 days, each country has its own rules, but in most west european countries you are considered a tax resident if you spend like 3-4 months in the country. And even if you cut all ties and are a "tourist", you can be caught by bank card transactions. They can see that a person made transactions in the country during a 180 day period, and send a big tax bill.

 

[platopk]

What happens if you combine the OP approach with a Caribbean CBI
passport?, now you are a citizen of two countries. Then you create some economic substance in your second passport nation. Now you have, tax residence in UAE(*), some economic substance in your CBI passport country, and no economic ties in the land of your birth passport.
(*) or get rid of UAE an go for a territorial tax territory.

 

[Konstanz]

What happens if you combine the OP approach with a Caribbean CBI
passport?, now you are a citizen of two countries. Then you create some economic substance in your second passport nation. Now you have, tax residence in UAE(*), some economic substance in your CBI passport country, and no economic ties in the land of your birth passport.
(*) or get rid of UAE an go for a territorial tax territory.

It's would not help. You have to build close ties to 1 particular country

 

[platopk]

It's would not help. You have to build close ties to 1 particular country

Ok so would this work? you put all your economic substance under a holding company located in your CBI passport. Your operating company which exploits under license the holding comany in another economic area from your birth passport.

 

[Cloudbanck]

Ok so would this work? you put all your economic substance under a holding company located in your CBI passport. Your operating company which exploits under license the holding comany in another economic area from your birth passport.

Look at how western countries define tax residency. Passport country/ies (mostly) don't matter, and with CFC rules where you own businesses doesn't matter either. What matters is center of vital interest / time spent / ties, and often how long you lived in the western country before leaving.