Crypto salary + defi farming / lending

[detailoriented]

Hi all,

Just discovered this forum and glad I did, have already gone through a bunch of discussions on NHR.

I'd love to get some thoughts from more experienced folks on my tax planning scenario.

1. Located in Germany (German passport), would like to leave ASAP to find a more favourable tax location.

I am exploring:
A) Mexico (temporary resident visa)
B) Portugal (NHR)

I would be earning a salary paid in crypto (USDC) and would also be doing general DeFi activities like staking, farming and lending crypto.

From what I'm reading if you are an individual, receiving crypto currency is not taxable in Portugal, however I am still a bit doubtful that if it's my primary source of funding, it will not be considered professional. I have a friend who has told me that he spoke with advisors in Mexico and they also told him that under the temporary resident visa foreign income, especially crypto, is not taxed.

Currently I'm leaning towards the Mexico approach as I'm not sure I buy that the NHR can really be tax free in my scenario.

Would appreciate any guidance on the matter!

 

[CyprusLaw]

Hi all,

Just discovered this forum and glad I did, have already gone through a bunch of discussions on NHR.

I'd love to get some thoughts from more experienced folks on my tax planning scenario.

1. Located in Germany (German passport), would like to leave ASAP to find a more favourable tax location.

I am exploring:
A) Mexico (temporary resident visa)
B) Portugal (NHR)

I would be earning a salary paid in crypto (USDC) and would also be doing general DeFi activities like staking, farming and lending crypto.

From what I'm reading if you are an individual, receiving crypto currency is not taxable in Portugal, however I am still a bit doubtful that if it's my primary source of funding, it will not be considered professional. I have a friend who has told me that he spoke with advisors in Mexico and they also told him that under the temporary resident visa foreign income, especially crypto, is not taxed.

Currently I'm leaning towards the Mexico approach as I'm not sure I buy that the NHR can really be tax free in my scenario.

Would appreciate any guidance on the matter!

With respect to the NHR it should be noted that only certain activities fall under the NHR, what you propose would potentially not qualify for NHR. It is noted that what is exempt from tax is foreign sourced income - for example dividends received from a foreign company.

One of the most common structures we meet is Cyprus company with the shareholder living in Portugal under the NHR. In this way your effective tax rated is approximately 15% (12.5 CIT plus 2.65% GHS contribution at the Cyprus level and no tax in Portugal).

Relocating to Cyprus would also work the same way as you would maintain the non dom status.

 

[detailoriented]

Thanks for the feedback. I have been investigating Cyprus in more detail in the last days as I was in Cyprus last November for 3 weeks and really enjoyed it there. The non dom tax resident arrangement seems to offer great benefits.

As someone who will be earning crypto as a salary and then lending that money, trading etc.. does this require the formation of a company or is it also possible to enjoy the tax benefits in Cyprus without establishing a company?

For the yellow slip:

1. If working abroad to bring a confirmation letter from the employer and payslip

I'm unsure how to fulfil this requirement. Is there a method common for folks going for non dom?

Any tips would be much appreciated!

 

[CyprusLaw]

Thanks for the feedback. I have been investigating Cyprus in more detail in the last days as I was in Cyprus last November for 3 weeks and really enjoyed it there. The non dom tax resident arrangement seems to offer great benefits.

As someone who will be earning crypto as a salary and then lending that money, trading etc.. does this require the formation of a company or is it also possible to enjoy the tax benefits in Cyprus without establishing a company?

For the yellow slip:

1. If working abroad to bring a confirmation letter from the employer and payslip

I'm unsure how to fulfil this requirement. Is there a method common for folks going for non dom?

Any tips would be much appreciated!

Hi, happy to Pm you to discuss this more