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RustCohle

New member
Context: I'm a small fish from EU who made some gains with crypto and is hustling to cash out some gains into international real estate to gain a very modest, but resilient and distributed financial independence. My hate my country of origin with a passion from deep down my libertarian soul, I don't want them to steal anything from me and I don't want them to know what I'm doing.
Thinking of flying to Dubai, cashing out around 40k$ in btc OTC, hope they don't declare me to EU and then put it as downpayment to a small property (I asked the developer if they accept physical cash and they said yes), and hope again that the rental gain would pay for the rest of the investment (with of course some modest savings as plan B).

Would the UAE bank receiving my rental income report me to EU even if the 2 countries have a double tax treaty? Would EU try to find out where did I get the money for the downpayment? Could I just say I made the money from gambling if SHTF? Any risks that I am failing to see here?
 

Martin Everson

Offshore Retiree
Staff member
Mentor Group Gold
Elite Member
Would the UAE bank receiving my rental income report me to EU even if the 2 countries have a double tax treaty?

Yes via CRS if you have EU address or any indicia on your account indicating your country in EU i.e EU telephone number or regular payments to a specific EU country.

Would EU try to find out where did I get the money for the downpayment?

If they investigate you will end up having to tell them.

Could I just say I made the money from gambling if SHTF?

You can tell them whatever you want but keep in mind there can be severe consequences for lying.

Any risks that I am failing to see here?

CRS risk, investment risk during covid times etc.
 

Gediminas

Offshore Tax Advisory
Mentor Group Gold
Commercial Service
Business Angel
hinking of flying to Dubai, cashing out around 40k$ in btc OTC, hope they don't declare me to EU

You can only hope for that, but never be sure. They can share the information with your country based on your citizenship.
 

Sols

Staff member
Mentor Group Gold
Would EU try to find out where did I get the money for the downpayment? Could I just say I made the money from gambling if SHTF?
Just expanding on what @Martin Everson said, you can say what you want, but what's your plan when they ask to see proof of winnings and proof that you gambled?
 

Martin Everson

Offshore Retiree
Staff member
Mentor Group Gold
Elite Member
Oh in case anyone was wondering when I mentioned they report under CRS indicia to countries you regularly send money too here is an example of N26 bank saying just that :(.

-------

What does N26 do with my tax information?​

The OECD requires certain tax information to be shared by means of the Common Reporting Standard(new tab) (ECR). To carry out our obligations, we must establish which country you’re taxable in. We do this through your tax identification or National Insurance number.

We forward this information via the German Federal Tax Office to tax authorities in other countries if:

  • You live in a ECR participating country.
  • You have a postbox or a second registered address in another ECR participating country.
  • When registering you gave a telephone number belonging to another ECR participating country.
  • You have a standing order, or make regular payments, to an account located in another ECR participating country.
---------
 

Raxxor

New member
Yes via CRS if you have EU address or any indicia on your account indicating your country in EU i.e EU telephone number or regular payments to a specific EU country.



If they investigate you will end up having to tell them.



You can tell them whatever you want but keep in mind there can be severe consequences for lying.



CRS risk, investment risk during covid times etc.
You can only hope for that, but never be sure. They can share the information with your country based on your citizenship.

So Dubai strategy is not working anymore? I read many times here about making a Dubai company to get residency and bank acc, go to live there for 183+ days, get tax certificate and you will be a non tax resident on your home country, then you can cashout crypto money with 0% tax to your dubai company/bank right?
 
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Gediminas

Offshore Tax Advisory
Mentor Group Gold
Commercial Service
Business Angel
So Dubai strategy is not working anymore? I read many times here about making a Dubai company to get residency, go to live there for 183+ days, get tax certificate and you will be a non tax resident on your home country, then you can cashout crypto money with 0% tax right?

It could work if you do it properly.

At first, you have to declare the exit of your current tax residency. In some countries, you have to pay taxes for a couple of years on a certain type of income, unless a treaty for the avoidance of double taxation between your country and UAE does not allow your country to collect such taxes. Plus it is important if your country considers you tax resident the whole calendar year or only until the departure date (if a treaty for the avoidance of double taxation exists, it might influence this treatment).
 

Raxxor

New member
It could work if you do it properly.

At first, you have to declare the exit of your current tax residency. In some countries, you have to pay taxes for a couple of years on a certain type of income, unless a treaty for the avoidance of double taxation between your country and UAE does not allow your country to collect such taxes. Plus it is important if your country considers you tax resident the whole calendar year or only until the departure date (if a treaty for the avoidance of double taxation exists, it might influence this treatment).

If Im from a western EU "comunist" shithole country like Spain and I never paid taxes here in my life but now I have X big enough money in cryptos and I refuse to pay this abuse, do I need declare my exit if I never paid taxes, im unemployed and i have all my money in cryptos? also do you know if Spain consider whole calendar year or departure date? Does Spain have a treaty for the avoidance of double taxation between UAE and them? tax advisors and lawyers here are absolute terrible... and im really dissapointed lately, being poor all my life was shit but I realized being rich is a headache now and I cant use my money without get scammed by my country.
 

Martin Everson

Offshore Retiree
Staff member
Mentor Group Gold
Elite Member
do I need declare my exit if I never paid taxes, im unemployed and i have all my money in cryptos?

Yes you do. Also Spain has an exit tax which they apply to unrealized capital gains on holdings of more than €4m (which may exclude you). However if it includes you then if you move to another EU/EEA country and sell the crypto within 10 years you would need to declare this with Spanish tax man and pay the capital gains tax. If you move to a non-EU/EEA country the tax on gains is due immediately. You also need to think about Spanish wealth tax unless you live in Madrid or do not meet the wealth tax threshold of €700k.

Unfortunately any CRS country you move to may still via indicia report back to Spain your account details or Spain could go fishing for the data from your new country you moved too. If they are chasing people for unrealised capital gains then this would really be the method they would use.

You may really want to just regularize your tax affairs or keep looking for a good tax advisor.
 

Raxxor

New member
Yes you do. Also Spain has an exit tax which they apply to unrealized capital gains on holdings of more than €4m (which may exclude you). However if it includes you then if you move to another EU/EEA country and sell the crypto within 10 years you would need to declare this with Spanish tax man and pay the capital gains tax. If you move to a non-EU/EEA country the tax on gains is due immediately. You also need to think about Spanish wealth tax unless you live in Madrid or do not meet the wealth tax threshold of €700k.

Unfortunately any CRS country you move to may still via indicia report back to Spain your account details or Spain could go fishing for the data from your new country you moved too. If they are chasing people for unrealised capital gains then this would really be the method they would use.

You may really want to just regularize your tax affairs or keep looking for a good tax advisor.
But what is the point to go UAE strategy if we need regularize our taxes before leave and we get tax abused before start our UAE strategy? What if I hide my crypto funds first in a private wallet or decentralized exchange and only declare small partial amount when leave and rest of money through UAE company as a profit made living there in UAE?

Tax advisors here are terrible and I dont know if they report people consulting them if they know customer purpose is evade taxes hiding the assets
 

RustCohle

New member
But what is the point to go UAE strategy if we need regularize our taxes before leave and we get tax abused before start our UAE strategy? What if I hide my crypto funds first in a private wallet or decentralized exchange and only declare small partial amount when leave and rest of money through UAE company as a profit made living there in UAE?

Tax advisors here are terrible and I dont know if they report people consulting them if they know customer purpose is evade taxes hiding the assets
I also thought about reporting 'some of it', but then I though I would appear on their radar and then they might check further, so I'd rather not declare anything at all and hope for the best. I am counting on them being highly incompetent.
Just my opinion though.
 

Martin Everson

Offshore Retiree
Staff member
Mentor Group Gold
Elite Member
But what is the point to go UAE strategy if we need regularize our taxes before leave and we get tax abused before start our UAE strategy?

You tell me.

What if I hide my crypto funds first in a private wallet or decentralized exchange and only declare small partial amount when leave and rest of money through UAE company as a profit made living there in UAE?

That would be your choice to break Spanish tax law.

I also thought about reporting 'some of it', but then I though I would appear on their radar and then they might check further, so I'd rather not declare anything at all and hope for the best.

Hope is a hell of a drug.

I am counting on them being highly incompetent.

You take your chances I guess conf/(%.
 

Admin

Forum Moderator
Staff member
Elite Member
Hope is a hell of a drug.
That's one of the many real good answers in this thread!

OP, you may read carefully what people have posted here to avoid troubles, today it is difficult to ignore the fact that tax evasion has become almost impossible unless you're the president of the USA or an EU leader.
 

MichalS

New member
well tex evasion is possible but only with small amounts or in 3rd world countries, higher amount and spain resident indeed looks risky
 

RustCohle

New member
Reasons why I'm not declaring it:
1. I'm not actually selling and cashing out in a bank account. My cryptos are on private wallets, I pay for services directly with btc and cash out smaller amounts OCT while traveling to other countries.
2. I'm a small fish, they are probably chasing others.
3. I'm from a messed up country where they make a lot of mistakes, it's actually riskier to declare your assets as you might end up with unexpected surprises. small scale tax evasion is very popular where I'm from.
4. I've lived abroad a lot (back and forth), they probably lost my track if they attempted to look into my accounts before.
5. ideological contempt. because f*** them, that's why.

Edit: 6. I've also traded quite a bit on decentralized exchanges, I wouldn't even know how to add up the tax, making things even more complicated and exposing myself to their craziness even more if I do declare (point nr.3). It just feels riskier to declare than not to.
 

Raxxor

New member
Reasons why I'm not declaring it:
1. I'm not actually selling and cashing out in a bank account. My cryptos are on private wallets, I pay for services directly with btc and cash out smaller amounts OCT while traveling to other countries.
2. I'm a small fish, they are probably chasing others.
3. I'm from a messed up country where they make a lot of mistakes, it's actually riskier to declare your assets as you might end up with unexpected surprises. small scale tax evasion is very popular where I'm from.
4. I've lived abroad a lot (back and forth), they probably lost my track if they attempted to look into my accounts before.
5. ideological contempt. because f*** them, that's why.

Edit: 6. I've also traded quite a bit on decentralized exchanges, I wouldn't even know how to add up the tax, making things even more complicated and exposing myself to their craziness even more if I do declare (point nr.3). It just feels riskier to declare than not to.
Soo if I understand it right, the main problem for "legal" tax evasion with cryptos and many other hidden assets going UAE or whatever low taxes country strategy is cashout/declare the assets/profits as if you got it AFTER you became an UAE resident and a non tax resident on your native home country, so avoiding declare it when you leave your country. Mostly of people with big profits on cryptos are holding the coins from years ago and now they need declare it like if they got it after they relocated, otherwise what is the point to avoid taxes if you declare it when you leave your country?? that is just dumb.

That's one of the many real good answers in this thread!

OP, you may read carefully what people have posted here to avoid troubles, today it is difficult to ignore the fact that tax evasion has become almost impossible unless you're the president of the USA or an EU leader.

Honestly I dont see the difficulty here, supposing you were "invisible" to your country not owning properties and being "poor", never paid taxes in your life like me and cryptos have many tools nowadays to hide your assets until you are ready to cashout it with a low tax strategy and relocation. Between private wallets, decentralized exchanges and even big exchanges dont report to authorities (except Coinbase and US people). Idk why many people call it "impossible", just do it right, relocate and when you become a non tax resident on your native country, just cashout to your new low tax country.
 
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azb1

Mentor Group Gold
I want to mention one point ,
You can find one or another way to buy property payment.
But Keep in mind that In Dubai , Everything is Digital.
Your Digital Signature left in Dubai forever. If your home country coming after you In a minutes they can get your all activity details.
It is better to Play in safe side.
 

Martin Everson

Offshore Retiree
Staff member
Mentor Group Gold
Elite Member
Idk why many people call it "impossible", just do it right, relocate and when you become a non tax resident on your native country, just cashout to your new low tax country.

You better hope the country you move to has no DTA or cooperation agreements with your home country. It is so easy for tax man to open a tax case against a person with none or little income suddenly moving to Dubai even many years after a move. Tax fraud has in most countries no statue of limitations :confused:.
 

Raxxor

New member
You better hope the country you move to has no DTA or cooperation agreements with your home country. It is so easy for tax man to open a tax case against a person with none or little income suddenly moving to Dubai even many years after a move. Tax fraud has in most countries no statue of limitations :confused:.
Anyways they need prove you got the cryptos and/or profits when you were living in your home country not in UAE (in my case NEVER used my local bank to deposit money in cryptos, I did everything inside cryptos ecosystem with initial small mined amount). Good luck for the tax man to find that in cryptos ecosystem like decentraliced exchanges and much more crypto tools nowadays. They only can track wallets and with high difficulty but not owners/IPs and real info... and even trying to find that is a HUGE effort and resources needed only for 1 person, imagine hundred of thousands of people. Also many other methods to mix here, obviously you never cashout everything at once, you can split profits for years and keep your main source of income hidden in cryptos, so they only could "investigate" the small amount cashed out.
 

challenge

Trusted
Anyways they need prove you got the cryptos and/or profits when you were living in your home country not in UAE (in my case NEVER used my local bank to deposit money in cryptos, I did everything inside cryptos ecosystem with initial small mined amount). Good luck for the tax man to find that in cryptos ecosystem like decentraliced exchanges and much more crypto tools nowadays.
ok you're lucky then.
But keep in mind, in many EU high tax countries nowadays it doesn't work that way... they find your suspect movements, they right there accuse you and tell you how much to pay. Then it's up to you to prove yourself innocent.
These days you start as guilty not as innocent for many tax authorities... and you need to lawyer up ($$$) to try to get out clean.
Many times it's not worth an plenty of people just pay the fine for peace of mind.

~~~
I'd go against the flow. Move out of the shithole high tax EU countries before it's too late.
No matter if its Germany, Spain or France.
But do not move to dubai straight, as martin said that will only raise red flags.
Relocate to another cheaper EU country first and make it legit, for a few years.
e.g. start a real business there(enjoy the lower taxes on pretty much anything), register to the local council, doctor, register as a citizen abroad if your old country requires it etc.
Bulgaria comes to mind. It'll still be enjoyable for a few years.
You can live like a king there for much less than dubai. 80% of payments are still made by cash...
You can still travel where you want while you are bulgarian resident, as long as you pay your small share of taxes nobody will complain.
Do not cashout bitcoin to your bank account. Use ATMs. Is not as uncommon to get out as much as ~5k EUR without ID verification in those areas...
it could still cost you a fair share (5-8%), but this shouldn't go against your libertarians soul :p

many small fishes are lured by dubai... but if you don't have the money for it, you are only going to live in an expensive prison (many europeans forget about shariah law until they get in troubles ;)).

Also let me say: it's not all black or white in the world. There's gray too.
I guess Martin also knows solutions to cashout millions of crypto money while living in dubai without CRS.
These solutions are available today as they've always been, but the doors won't open for less than 1mln, and the entry fee will keep rising.
 
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