Advice re offshore banking for business and personal

[daninpacific]

Hey peeps

Total newbie to the forum here, so hello smart humans!

Looking for some sound advice, as having read through the forum posts to-date it seems like the wild west when it comes to offshore banking.

I'm based in NZ and have a legitimate digital consulting and development business with clients here.
I'm looking to be based primarily offshore next year for a number of reasons - cost of living is getting super high here and long term I'd like to buy a home elsewhere where I've got way more bang for buck.

Setting up an offshore company seems pretty straight forward (BVI, Singapore, Vanuatu (though I'm unsure if bank account can be setup as a foreigner)) but the banking side seems to be where a lot of challenges arise.

Looking for a legitimate bank, or whatever that means that's got debit cards and can transfer funds easily (seems like there's issues with certain countries and wires etc...)

Appreciate any thoughts, advice & recommendations including company recommendations that can help with the whole process.

Best
Dan

 

[Sols]

Where do you plan to relocate to? It's almost always easier if you set up a company where you live, rather than go through the hassle of setting up and maintaining an offshore company.

Offshore companies and offshore banking today are nothing like it appears if you just read about it on old websites or many service providers' websites.

Pick a suitable home base, whose taxes, costs of living, and other parameters are to your liking. Form a company that works with the tax laws of your new location.

 

[daninpacific]

Where do you plan to relocate to? It's almost always easier if you set up a company where you live, rather than go through the hassle of setting up and maintaining an offshore company.

Offshore companies and offshore banking today are nothing like it appears if you just read about it on old websites or many service providers' websites.

Pick a suitable home base, whose taxes, costs of living, and other parameters are to your liking. Form a company that works with the tax laws of your new location.

Hey Sols

Thanks for the response.

Lookig at Mexico & Costa Rica, both have good digital nomad visa's to get underway & ability to purchase property as a foreigner. Plan to split location time so I'm not longer than 6 months in a calendar/financial year. However, both countries seem complicated re company/tax/reporting, and given I won't be conducting local business in either, plan was to establish company and banking in a country that's better geared for this.

But totally open to thoughts, ideas & suggestions.

 

[Sols]

Plan to split location time so I'm not longer than 6 months in a calendar/financial year.

This sounds like you might've gone down the PT (Permanent Traveller) rabbit hole, which I'd strongly advice against for most people in most cases.. It's not sustainable anymore. Things will be much easier for you if you have a place that you call home and are tax resident in.

Costa Rica, for example, would be a good place to call home for tax purposes. You need to find an excuse to pay some local tax to qualify as tax resident, but it can be a symbolic sum. The majority of your income/wealth can remain untaxed under Costa Rica's territorial tax system.

However, both countries seem complicated re company/tax/reporting, and given I won't be conducting local business in either, plan was to establish company and banking in a country that's better geared for this.

Just hire an accountant. It won't cost more than few hundred or maybe a few thousand USD per year, and they'll take care of the paperwork for you.

For foreign banking purposes, being resident in CR or MX isn't as good as being resident in NZ. You will be considered a higher risk applicant, which restricts your options for finding banking.

But totally open to thoughts, ideas & suggestions.

That's good because it means you have the widest possible opportunity to find something that fits your life and goals. However, it also means you are far away from making a decision. I would recommend doing a lot more research and if you have specific questions about specific places, ask them.

 

[daninpacific]

This sounds like you might've gone down the PT (Permanent Traveller) rabbit hole, which I'd strongly advice against for most people in most cases.. It's not sustainable anymore. Things will be much easier for you if you have a place that you call home and are tax resident in.

Costa Rica, for example, would be a good place to call home for tax purposes. You need to find an excuse to pay some local tax to qualify as tax resident, but it can be a symbolic sum. The majority of your income/wealth can remain untaxed under Costa Rica's territorial tax system.


Just hire an accountant. It won't cost more than few hundred or maybe a few thousand USD per year, and they'll take care of the paperwork for you.

For foreign banking purposes, being resident in CR or MX isn't as good as being resident in NZ. You will be considered a higher risk applicant, which restricts your options for finding banking.


That's good because it means you have the widest possible opportunity to find something that fits your life and goals. However, it also means you are far away from making a decision. I would recommend doing a lot more research and if you have specific questions about specific places, ask them.

Hahaha... PT rabbit hole is a good one to go down.

Good advice. Thank you.

At present I'm not planning on giving up tax residency in NZ for the sake of it, unless financially it makes sense to do so.
NZ Passport, albeit cost of living and tax rates here, it's a good passport to have.

Re foreign banking purposes, could I not set everything up, company & bank account while being a NZ resident? And if that changes later, it changes?

Am possibly looking to have two companies, NZ based and offshore (we work with contractors overseas currently, so splitting that part of the business into its own entity). Offshore company eventually has offshore asset ownership, aka offshore property.

Like most people starting on this journey, trying to find good advice is tricky & NZ accountants to date seem confused when I explain what I want to do, and how to structure so that it's tax smart.

Question, is it worthwhile upgrading account to get access to more in depth forum chats?

Thanks again.

 

[Forester]

Re foreign banking purposes, could I not set everything up, company & bank account while being a NZ resident? And if that changes later, it changes?

Yes, you can. But as it was already mentioned, setting up and running an offshore company & banking is significantly more difficult (especially for the latter) than doing it locally. If you are comfortable with this, go this way

Am possibly looking to have two companies, NZ based and offshore (we work with contractors overseas currently, so splitting that part of the business into its own entity). Offshore company eventually has offshore asset ownership, aka offshore property.

It makes sense – while you stay in NZ. Just be advised that the offshore location should be choosen also wrt to the location of your business partners. Just as an example, Caribbean companies are often regarded as suspicious inside EU...

Like most people starting on this journey, trying to find good advice is tricky & NZ accountants to date seem confused when I explain what I want to do, and how to structure so that it's tax smart.

I am not familiar with the situation in NZ; just generally – it is pretty common that ordinary accountants are not well oriented in the offshore tax optimisation etc., nevertheless I believe that as in some other countries that I am familiar with, there exist well-oriented professionals in NZ, too. Usually it is necessary to search not among accountants but among specialised tax advisors and/or lawyers. Beware, in many cases it is not cheap – but it should be worth some investment

Question, is it worthwhile upgrading account to get access to more in depth forum chats?

Well... Honestly: try it for one month (it's not a fortune, IMO) and you will see. For someone it is very useful, for someone not so – difficult to say; but in any case, it's a way how to support this community / source of information.

Thanks again.

You are welcome.

 

[myhand]

Question, is it worthwhile upgrading account to get access to more in depth forum chats?

It is worth it if you are looking for information not public available in the community. You also gain access to DM/PM people which can be useful in your case to ask other digital nomads around here for advise.

At present I'm not planning on giving up tax residency in NZ for the sake of it, unless financially it makes sense to do so.
NZ Passport, albeit cost of living and tax rates here, it's a good passport to have.

You should not give up your passport there. You should consider which country or island would suite you first! We are many expats around here discussing XY country i.e. Switzerland, Cyprus, Maltha, Bahrain, Georgia, Bahamas you name it. There is no one fits all!