Parents' home as "permanent home available"?

[flyingadventures662]

Does anyone have experience if this sentence, which is used in virtually all DTAs:

"he shall be deemed to be a resident of the Contracting State in which he has a permanent home available to him"

works not only for owning a property, but also:
* having rented a property
* being able to use for free at any time other property (for example, parents' property)?

 

[Houdini]

What's strange with this sentence, if you live with your parents in their house or you have your own address makes no difference.

 

[Sols]

This clause is generally used as a tie breaker or as one of several factors in case a person is suspected of tax evasion or treaty abuse. It's not meant to refuse you treaty access simply because your parents happen to have a spare bedroom.

Some people rent apartments in one country (often lower tax) and live for free in another country in a family member's property, without telling anyone. Those are the kind of people this clause is meant to cover.

 

[flyingadventures662]

What's strange with this sentence, if you live with your parents in their house or you have your own address makes no difference.

The thing is that I don't live there.

I want to make sure that if I travel around in rotation in other countries without settling anywhere it would remain my tax country.

But, if in the same time, to have a one-man-business company in a other country.

The "available home" clause is first priority in the tie breaker list, so it should precede over "economic interests", right?

 

[Konstanz]

It's important not to live in home country and have proof you lived outside country. Credit card statements, flight tickets etc etc

 

[JohnnyDoe]

Last time financial popo looked into my affairs they checked, through credit cards and phone tracking, how often I went to my parents’ home. They found that I did that 2 times in a year, for Christmas and another festivity, and both times I switched the phone on and off at the airport.

 

[Konstanz]

Last time financial popo looked into my affairs they checked, through credit cards and phone tracking, how often I went to my parents’ home. They found that I did that 2 times in a year, for Christmas and another festivity, and both times I switched the phone on and off at the airport.

Yes, similar was to me. They checked credit cards statements, flight tickets, they even wrote to my new country with request to provide information if I really lived there. They asked for tax residence certificates. Literally they checked everything
They also check discount cards. If you use some discount/loyalty cards in home country that's how people get caught.

 

[Marzio]

through credit cards and phone tracking

Do you still have a phone number and credit cards from your home country?

 

[JohnnyDoe]

Do you still have a phone number and credit cards from your home country?

They tracked the foreign Amex I use for groceries when I go to that country (which is effectively no longer my home country since a long time), and the foreign phone number I used to call my parents. I guess they found it by taping my dad’s phone.

 

[polonieth]

The thing is that I don't live there.

I want to make sure that if I travel around in rotation in other countries without settling anywhere it would remain my tax country.

But, if in the same time, to have a one-man-business company in a other country.

The "available home" clause is first priority in the tie breaker list, so it should precede over "economic interests", right?

Which home country do you want to be your tax country?

 

[flyingadventures662]

Which home country do you want to be your tax country?

1) For a tax residency of a natural person: my home country.

2) But in the same time, not to be perceived as if I manage my foreign company from there.

Looking strictly at the DTA it seems it might work because:

- Having a permeant home only in my hime country and not living there should be enough for 1)
- Living as a digital nomad and switching countries with stays under 183 days and never settling anywhere does not seem logical to rurn my home country to be the country for managing the company for corporate tax purposes. In this case, the tax residency of the foreign company should remain the country where it is incorporated.

Or I am missing something?

 

[JohnnyDoe]

Or I am missing something?

a tax advisor

 

[flyingadventures662]

a tax advisor

Of course. This is my next step.

I was just checking if someone has tried and if I heard a firm "No" here I might reconsider even research further.

Thanks for now

 

[Marzio]

They tracked the foreign Amex I use for groceries when I go to that country (which is effectively no longer my home country since a long time), and the foreign phone number I used to call my parents.

Man you must be a VIP person for your tax office's country.

Or I am missing something?

At the very least you are probably missing CFC rules of your country because even if you don't trigger PE rules by being a nomad, you still control the company from your country since you are tax resident there.

Also, the moment you form the company in the other country and open a bank account for the company CRS will kick in and bank will report back to your country about your offshore bank account.

 

[flyingadventures662]

At the very least you are probably missing CFC rules of your country because even if you don't trigger PE rules by being a nomad, you still control the company from your country since you a

Hey thanks for that. I will look into it.

 

[JohnnyDoe]

Man you must be a VIP person for your tax office's country.

Not really, more like someone who enjoys stalking me. Can happen to anyone, for example from a business competitor, wife etc.

 

[Konstanz]

Not really, more like someone who enjoys stalking me. Can happen to anyone, for example from a business competitor, wife etc.

Can I ask is this from East , West or Central Europe?
Exactly, especially if you have a little media attention this can trigger investigations...

 

[zzzzzz]

@Konstanz @JohnnyDoe what do you think is the reason for these investigations? Do you still have some ties to your home country or are HNWI, spending too much time there, western europe citizenship, bragging in the media...?

 

[JohnnyDoe]

Can I ask is this from East , West or Central Europe?
Exactly, especially if you have a little media attention this can trigger investigations...

Italy

@Konstanz @JohnnyDoe what do you think is the reason for these investigations? Do you still have some ties to your home country or are HNWI, spending too much time there, western europe citizenship, bragging in the media...?

The state needs money and tries to take it from wherever it can

 

[flyingadventures662]

@Marzio

I have nothing to hide nor I want or can hide it anyway. Both countries are in the EU.

I checked CFC rules and in my country they generally (with two small exceptions I don't fall into) don't apply to natural persons, but to local companies who own foreign companies.

So as crazy as it sounds I am starting to think it might work.

If I decide to do it I will discuss it with my lawyer anyway. He had told me in the past that this stuff works only if there is no DTA with the country. But I haven't discussed the nomadic plan so far with him.

The idea of this topic was to check if I may count on the parents' home as a permanent home available to keep me tax resident as a natural person, while in the same time I don't live there. Which as far as I understand and find from other research seems to be true.

Thanks anyway again.