Living In Panama Without Tax On Salary

[PermanentTraveller]

I am an NZ citizen who has lived in Australia for the past 3 years and while doing so, I setup a Sole Trader business doing SEO for local Australian companies.

I have since moved away from Australia and don't plan on going back to NZ or AU for any longer than a few months per year at most for the next 5-10 years.

I invest my money in Crypto, and pay tax in Australia where my business is, but I want to move offshore to Panama. I plan on getting tax residency there, opening a company and selling my sole trader business to my Panama company to continue generating my income. This helps me avoid CGT in Australia, as I wont need to pay any tax there (besides GST) however, if I take drawings from my company, I pay Panama Tax.

Is there a simple, legal way to avoid this tax?

My thoughts are to open another company somewhere like the BVI and outsource the digital marketing work to that company. So the Panama company would get paid by the clients, then a good percentage of that would go to the BVI company (preferably in a Hong Kong or Swiss bank account). From there, I would take drawings into that HK or Swiss bank account and use that money as my day to day money. From my understanding, as long as I do not bring it back into Panama bank account I wont pay tax on it.

This is my take on the 3 flag theory, but I have no real experience on the legalities of this and if I am missing something, or if the whole process can be made much more simple.

Currently I do not make a huge wage, but when I get to panama I will be expanding into marketing within America so I want to get this right from the start, as well as avoiding paying CGT in Australia for my Cryto Currency Investments.

Any help here would be massively appreciated.

 

[countryfree]

Panama?

Why did you choose Panama? There are countries with a lower income tax for individuals.

 

[PermanentTraveller]

Panama?

Why did you choose Panama? There are countries with a lower income tax for individuals.

Thanks for the reply Countryfree

Because I would like to live in Panama as my base. What ever place I choose, it needs to be my place of residence for taxation or I will default to paying New Zealand Income taxes.

What other countries offer easy residency for tax purposes and cheaper income tax?

 

[Okanda Fernando]

Cyprus has residency permit called Non Dom which is very good for people like you

 

[countryfree]

OK, so you could enjoy living in Panama. That was my point. I mean that getting tax residency for an individual supposes getting a permanent address (buying or renting an apartment) and spending some time in the country. So you must like the place.

There are other low-tax countries, like Macedonia to name one, but... You need to travel there first, and then see if you like it.

 

[JohnK]

Is Panama not dangerous to live in? I mean lot's of criminal activity and so on?

 

[Paul77]

Is Panama not dangerous to live in? I mean lot's of criminal activity and so on?

No absolutely not. It is even more peaceful than living in the US! Until now I lived there full 3 years without a problem and I must say I like it more than any other latin american country. He made the best deccision to pick Panama. Belize is also an option but never do that mistake. Panama is 20 years ahead. Now I am trying Mexico and man you can immediately feel the difference. So regarding Panama it is absolutely safe and even safer than Costa Rica where I spent also quite some time and felt more insecure there than anywhere else in Panama. Lets return back from offtopic. Panama isn´t so interesting anymore after Panama papers went viral.