CRS Report period

[JamesDean]

Hello to everyone.
I have read lots of topics but haven't found answer to my question.

I am tax resident of Country A which has signed convention but does not have start exhange date. No MCCA signing either.
I plan to open account in Country B, which is about to start exchange in September 2023.

My question is, when Country B starts exchanging info with other countries what would be the reporting period? Would it be just data from 2022 or will they send data from more years?
When Country A signs and set first exchange date, would they receive all historical data that other countries submitted or just the current year.

My plan is to close the account in Country B by the end of 2023, hoping that Country A won't start exchange until 2025. In that case, year 2023 would not be reported to Country A. Reasons for this are better tax conditions in Country B.
Am i correct to assume this?

 

[bigdaddyleon]

A. Reasons for this are better tax conditions in Country B.

But if you live in country A, surely you can't benefit from the tax rules in country B?
Or how exactly should we imagine this?

 

[JamesDean]

But if you live in country A, surely you can't benefit from the tax rules in country B?
Or how exactly should we imagine this?

Because Country B is taxing all income from non-residents that are made on it's teritory. And i would be making income on the teritory of Country B. But even if you pay tax as non-resident in Country B, you are obliged to report that to Country A which charges more for that kind of income. I want to make sure that theincome from Country B will never be reported to Country A and i don't have to pay the difference between two countries. I plan to pay taxes in the Country B.

I hope that i am clear now.

 

[bigdaddyleon]

Because Country B is taxing all income from non-residents that are made on it's teritory. And i would be making income on the teritory of Country B. But even if you pay tax as non-resident in Country B, you are obliged to report that to Country A which charges more for that kind of income. I want to make sure that theincome from Country B will never be reported to Country A and i don't have to pay the difference between two countries. I plan to pay taxes in the Country B.

I hope that i am clear now.

I think if you could name the countries it would be a little easier to give you advice.
It is possible that both countries have a double tax treaty.

You could also work in country B, receive your money in a business account in the USA & this is not reported.

 

[bubbledouble]

You could also work in country B, receive your money in a business account in the USA & this is not reported.

Do you think it will work with Mercury and a US LLC ?

I think if you could name the countries it would be a little easier to give you advice.

You should mentioned the countries, that can't hurt you.

 

[bigdaddyleon]

Do you think it will work with Mercury and a US LLC ?

I think so, but personally I would probably aim more for a real bank like TD Bank or Bank of America

 

[JamesDean]

Of course. Country A is Serbia and country B is Montenegro.
In fact, i am not trying to avoud paying the taxes. I am trying to avoid paying social contributions on that income, as i am already paying in Serbia for that. But i can spend some time yearly in Montenegro (i have license for temporary stay) and i can open local bank account. I work as a freelancer.

Both countries have double tax treaty, but Montenegro is not requring paying social contributions on that income in percent, and Serbia does, regardless of your status, that you are already paying. As an example, if you have income of 10.000 euros, in Montenrgro, you would pay around 1000 on tax and that's all. But in Serbia, you would be paying 1000 on tax and 2500 euros on social contributions.

 

[bubbledouble]

how much income do you have a year ?

 

[JamesDean]

how much income do you have a year ?

Around 20.000 euros.

Let me be more specific. I am full time worker and from my salary i am already paying taxes to the country and obligatory social contributions. I work remotely. But i also do freelancing. And Country A (Serbia) is requiring to pay again social contributions on my income from freelancing, even though that i am already paying as full worker.

I could be freelancing from Montenegro, spending some months there in a year, and i want to pay tax on my freelance income there. But Montenegro does not require social contributions. So wondering if i can think that 2023 would be safe there.

 

[bigdaddyleon]

I could be freelancing from Montenegro, spending some months there in a year, and i want to pay tax on my freelance income there. But Montenegro does not require social contributions. So wondering if i can think that 2023 would be safe there.

Difficult to predict, I would say that you still have to pay in your country of residence (in this case Serbia).

I would not classify your plan as really safe

 

[JamesDean]

Difficult to predict, I would say that you still have to pay in your country of residence (in this case Serbia).

I would not classify your plan as really safe

It is ok. But what about original question.

If hypotecially my Country A - Serbia signs MCAA and sets first date of exchange 2025 would they get from Montenegro data from 2023?

 

[OffshoreMonero]

I think that CRS/AEoI is inevitable. The entire world will be roped into compliance within the next 3 years for sure.

Sadly, hopping countries and moving corporations around will only work for so long to keep bank balances a secret.

 

[EliasIT]

Around 20.000 euros.

Just pay your taxes where you are and don't cry. What you try to do costs you more than the few thousand euros you try to evade from.