Cashing Out Crypto Gains in Dubai

[Jimbo5]

Hi,
I am hoping someone could tell me if it is worth cashing out My Crypto Gains in Dubai and bypass Tax on Capital Gains in the UK.
I am working on the hypothesis that my Crypto Gains could be in excess of 5 Million UK pounds by the end of this year.
I currently have a holiday home in Dubai and love going there for holidays and could get a resident's visa if I wanted to through owning property in Dubai. I have heard that I can become a tax resident of Dubai if I live there for over 180 days of the year. I could probably do this for a year or two but wouldn't like to do this for 5 years and would like to come back to the UK after cashing out.
I know there is a HMRC law that states that any gains that I make outside of foreign employment would be subject to UK tax when coming back to the UK if within 5 years, does that mean I would be subject to cap gains tax if the money hits my UK bank account when I return within 5 years ?
If I set up a freezone company or an Ofshore company in Dubai could I take the realised capital gains as a form of employment income similar to bitcoin trading gains and therefore not have to pay the capital gains tax when returning to the UK?
My end goal is to puchase property with my cashed out funds in the UK so I need to eventually bring the funds back so leaving the money abroad in an offshore account is not an option for me.

Thanks in advance for any advice.
Jim

 

[Fred]

Hello Guys,

I have read some misleading information here - if someone isn't sure just ask us to take care of you.

If the whole structure is setup right it won't cost you more then the 8.000-10.000 USD and the Crypto Cash Out max. 1%

 

[Fred]

Well what the people are looking here is a fiat on-/off-ramp for no source of funds coins.

They have to be to effectively hide from HMRC.

This fact doesn't change by spending 3x costs on a setup and additional 2-3% for transactions.

s**t is s**t even if painted gold - that's my point.

So if you are willing to go this route then don't overpay as the facts doesn't change and it keeps questionable anyways.

 

[CaptK]

Well what the people are looking here is a fiat on-/off-ramp for no source of funds coins.

They have to be to effectively hide from HMRC.

This fact doesn't change by spending 3x costs on a setup and additional 2-3% for transactions.

s**t is s**t even if painted gold - that's my point.

So if you are willing to go this route then don't overpay as the facts doesn't change and it keeps questionable anyways.

The issue is they need to bring the funds back in. If it was a relocate and only return to see family then a standard set up would work. But if you intend to go back, buy a house and invest.

From someone who can talk from a UK perspective and have an insight to a few other countries.

Just like Google, Amazon and Apple are able to circumvent the IRS legally. A proper structure will get you to where you need to be, and most importantly be able to sleep at night.

 

[Fred]

I heard MMCrypto used DLS Dubai but is there any proof of this?

Despite of what you heard you see on YouTube anyway where all the Crypto guys are based and they are based in Dubai for a reason.

It's obviously that Dubai is the way to go in 2021 if you are into the Crypto Market with trading or holding since few years.

Especially if you are in your 20s and 30s you have right now the best time of your life in Dubai with the worldwide lockdown everybody that made some money is coming to Dubai - it's a really nice community that has grown here over the last months.

Anyway if you made millions with Crypto then give it a try.

I understand the struggle as a Crypto Investor that became super rich over the last 6 months but basically doesn't have any entrepreneur mindset or skill.

You can't force anybody to his own luck and the truth is that again 80% of the people will loose money in the current bull market because of simply taking no action.

 

[khinkali]

I keep hearing this tripe but it's not Coinbase reporting you for BUYING crypto that triggers the tax authorities, it's the disposal or selling of crypto for fiat that does this.

The way things are going, all VASPs in OECD and beyond will be required to hand your details to the next VASP when you transfer. Do you think that Coinbase and other VASPs won't hand over the details of people who moved coins to private wallets?

If you bought 100 BTC on Coinbase at $1,000 each for $100,000 in 2017 and now you move to a private wallet, a tumbler, then cash out to a new account registered in Dubai or St Kitts or the moon then you have two issues: 1. What happened to the 100 BTC that you bought while UK resident? 2. How did you earn the $5,000,000 in your year abroad?

I reckon that if you had the happy coincidence of losing the 100 BTC and then making 100 BTC worth of $ income or gains while living abroad for a tax year, HMRC are really going to want to see exactly how that happened if you do get investigated.

A UK resident with unrealised gains would do well to move to Dubai and then stay non-UK resident for 5 tax years. Some people trash the Dubai lifestyle and there's no way I'd want to live there on $1k per month, but if you have money it's a decent option. Alternatively, UK statutory residence rules mean you can keep quite a lot of UK attachments while non-resident and you don't need to stay in some other place full time. Being semi-nomadic for 5 years is not too bad if you have $millions.

If I understand correctly, with UAE residence for banking and Georgia HNW programme for tax residence, it looks like you could live minimum 2 days in UAE (6 months apart), up to 182 days in Cyrpus, 19 to 119 days in UK (depending on ties like family, work and housing), and 61+ days elsewhere. Winter in Dubai, Spring and Summer in Cyprus and Autumn in Georgia gives good weather all year (but watch for PE or other issues in UK or Cyprus if working or actively trading). Does anyone here disagree with this approach?

 

[CaptK]

The problems you will face are

1. If you bought from Coinbase and other popular CEX your info will be passed on to HMRC at some point.

2.You are liable for your gains regardless if they were accumulated in the UK

3.To get it right your structure would have to be very solid and expensive.

There are a multitude of ways to mitigate the tax burden by diluting or using the gains as in other instruments such as a loan.

 

[Jimbo5]

The problems you will face are

1. If you bought from Coinbase and other popular CEX your info will be passed on to HMRC at some point.

2.You are liable for your gains regardless if they were accumulated in the UK

3.To get it right your structure would have to be very solid and expensive.

There are a multitude of ways to mitigate the tax burden by diluting or using the gains as in other instruments such as a loan.

Thanks for your response.
1. Bought most of my crypto from Coinbase. So I guess, I would have to pay the Capital Gains Tax, when I cash out ?

I guess if I was a tax resident in UAE when I bought crypto I wouldn't have to pay any capital gains tax, but that isn't the case for me.

3. You say there is a company structure that I could set up but would have to be solid and expensive. So are you saying that it wouldn't be worth doing this ?

I have thought of just getting a loan off my crypto and not cashing out but not sure if this is worth pursuing, I guess it depends on how I could service the loan.

 

[mebuq]

or send the crypto to the wallet of non tax resident and they can cash it out for u the easiest

 

[CaptK]

or send the crypto to the wallet of non tax resident and they can cash it out for u the easiest

How does he explain where the crypto went to and don't forget they can follow it on the blockchain!!!!

Thanks for your response.
1. Bought most of my crypto from Coinbase. So I guess, I would have to pay the Capital Gains Tax, when I cash out ?

Then a structure is required.

I guess if I was a tax resident in UAE when I bought crypto I wouldn't have to pay any capital gains tax, but that isn't the case for me.

correct or if you were between countries you can play one off against the other.

3. You say there is a company structure that I could set up but would have to be solid and expensive. So are you saying that it wouldn't be worth doing this ?

Depends on the amount and also how long before you intend to cash out.

I have thought of just getting a loan off my crypto and not cashing out but not sure if this is worth pursuing, I guess it depends on how I could service the loan.

Yes this can be structured to work in your favour.

 

[mebuq]

he can say that its a payment made to someone as an investment or payment. and then this someone can pay him in whatever liquid asset he wants. or wire him the money to his Nevis account or the caymans

 

[CaptK]

he can say that its a payment made to someone as an investment or payment. and then this someone can pay him in whatever liquid asset he wants. or wire him the money to his Nevis account or the caymans

When he gets a letter from HMRC regarding his Coinbase account what will he say?

 

[mebuq]

he will tell them he paid for a service from a consultant or whatever accountant online and paid in bitcoin

 

[mebuq]

When he gets a letter from HMRC regarding his Coinbase account what will he say?

https://twitter.com/x/status/1385324038034182154

 

[Jimbo5]

he will tell them he paid for a service from a consultant or whatever accountant online and paid in bitcoin

Thanks for your comments Mebuq, I have thought of sending the money to the non tax resident. I don't think it is a problem for me if I keep the money offshore. The issue arises if I bring the money back to the UK. I am looking at around 5 Million UK pounds. I'm sure I will be asked questions as money laundering alarm bells will ring, on where the money came from if I get the money transferred to my UK bank.

How does he explain where the crypto went to and don't forget they can follow it on the blockchain!!!!


Then a structure is required.

correct or if you were between countries you can play one off against the other.

Depends on the amount and also how long before you intend to cash out.

Yes this can be structured to work in your favour.

Can you give me an example of roughly how much it would cost to set up a structure like you described ?

 

[JohnLocke]

he will tell them he paid for a service from a consultant or whatever accountant online and paid in bitcoin

Let's hope it is that easy, won't they ask for supporting documents?

 

[CaptK]

Thanks for your comments Mebuq, I have thought of sending the money to the non tax resident. I don't think it is a problem for me if I keep the money offshore. The issue arises if I bring the money back to the UK. I am looking at around 5 Million UK pounds. I'm sure I will be asked questions as money laundering alarm bells will ring, on where the money came from if I get the money transferred to my UK bank.


Can you give me an example of roughly how much it would cost to set up a structure like you described ?

Total set up would cost about 25K, to include Company structure, actual real business contracts that can be verified. A percentage of the amount that is negotiable but budget 2-5%.

 

[mebuq]

Total set up would cost about 25K, to include Company structure, actual real business contracts that can be verified. A percentage of the amount that is negotiable but budget 2-5%.

jumbo sell and move to Dubai. you will have a longer time trading tax free than anywhere in the world, so double the time double the profits. and a Dubai residency.

 

[mebuq]

if you want I can help you to transfer to my wallet. and give them liquid. then you can buy them gold bars in Switzerland and this way you can go back to the uk with no money and no crypto and your liquid assets are out of the banking systems in special vaults. I can put you through my lawyer in Zurich if u want

 

[CaptK]

jumbo sell and move to Dubai. you will have a longer time trading tax free than anywhere in the world, so double the time double the profits. and a Dubai residency.

If it was that easy we wouldn't be talking about it.

Have you done this for real?

Don't put people in s**t for a few bucks.