Zero days on UAE gold visa. Will it work?

[hortm]

Situation -

Passive investment bank account in Switzerland (Corporate, Seychelles);
UBO has 10 years UAE Gold Visa;
Has own apartment in UAE (more than AED 2m price);
Visits UAE zero times a year;
At bank on file has UAE residency;
Spends most of his time in Georgia, EU, Thailand;
Pays zero taxes.

Question -
Does this actually work?

UAE laws (please carefully read and mind word ANY):

https://mof.gov.ae/wp-content/uploads/2023/03/Ministerial-Decision-27-of-2023-of-Tax-Residency.pdf

https://tax.gov.ae/Datafolder/Files/Legislation/Corporate%20Tax/Cabinet%20Decision%2085%20of%202022%20-%20For%20publishing.pdf

 

[JustAnotherNomad]

Not enough information to decide, it will depend on where that person actually spends their time, ties to other countries (especially EU) etc.
Probably the person would simply not be tax resident anywhere, can't imagine the UAE would issue a tax residency certificate. But that by itself doesn't mean one would have to pay tax - but it would probably make it easier for some other country to claim you as tax resident.
So then the UAE residency wouldn't bring any benefits - you might as well drop it and get residency in Thailand or Georgia instead and set up something based on that.

 

[hortm]

Not enough information to decide, it will depend on where that person actually spends their time, ties to other countries (especially EU) etc.
Probably the person would simply not be tax resident anywhere, can't imagine the UAE would issue a tax residency certificate. But that by itself doesn't mean one would have to pay tax - but it would probably make it easier for some other country to claim you as tax resident.
So then the UAE residency wouldn't bring any benefits - you might as well drop it and get residency in Thailand or Georgia instead and set up something based on that.

I am thinking different angle. How potential country (one claiming he is resident there) will know about existence of the account? Switz sends no data to UAE.

 

[JustAnotherNomad]

Switzerland does send data to the UAE, they both have implemented CRS. But so what?
The question is which country could try to tax you in that situation. Not what will the UAE do or how could they find out.

 

[hortm]

Switzerland does send data to the UAE, they both have implemented CRS. But so what?
The question is which country could try to tax you in that situation. Not what will the UAE do or how could they find out.

Switzerland is not sending data to UAE. UAE is sending data to Switzerland. UAE decided to be non reciprocal.

Check -

Activated exchange relationships for Country-by-Country reporting - OECD

This section shows all bilateral exchange relationships that are currently in place for the automatic exchange of CbC Reports between tax authorities.

www.oecd.org

 

[Paul Tudor Jones]

The question is always - what is your home country? Do you have ties to your home country (property, family, etc)? Do you spend 180+ days a year at your home country?

Your biggest risk is always your home country asking you where do you pay taxes and asking for PROOF in form of tax residency certificate. Best course of action is to not have any money in your home country and not spend any time there. Thus it's less likely that they will care about you.

If you're coming from an aggressive country like Sweden\Germany\Spain, it's best to take extra precaution and make sure you can get a tax residency certificate in UAE (= actually spend 180+ days there) or at least have proof that you are in UAE often (think receipts for spending money there, buying food, phone bills, etc).

 

[hortm]

The question is always - what is your home country? Do you have ties to your home country (property, family, etc)? Do you spend 180+ days a year at your home country?

Your biggest risk is always your home country asking you where do you pay taxes and asking for PROOF in form of tax residency certificate. Best course of action is to not have any money in your home country and not spend any time there. Thus it's less likely that they will care about you.

If you're coming from an aggressive country like Sweden\Germany\Spain, it's best to take extra precaution and make sure you can get a tax residency certificate in UAE (= actually spend 180+ days there) or at least have proof that you are in UAE often (think receipts for spending money there, buying food, phone bills, etc).

I do not understand how country claiming be be my home will know that bank account even exists. Data cuts after Switz. They are not sending info to UAE.

 

[JustAnotherNomad]

The question is always - what is your home country?

I don't understand why in this day and age people still talk about "home countries". I left my "home country" when I was 18 years old.

Do you spend 180+ days a year at your home country?

Irrelevant - could become liable for tax much sooner.

Your biggest risk is always your home country asking you where do you pay taxes and asking for PROOF in form of tax residency certificate.

Some countries may do that, but it's not relevant. You can be tax resident in multiple countries at the same time, and you can be liable for taxes without being tax resident in a country.

If you're coming from an aggressive country like Sweden\Germany\Spain, it's best to take extra precaution and make sure you can get a tax residency certificate in UAE

That's really funny because neither Sweden nor Germany have a tax treaty with the UAE, so they won't give two shits about a TRC from the UAE.

(= actually spend 180+ days there)

That's not even required to get a TRC.

I'm amazed how much wrong information you could cram into such a short post.

I do not understand how country claiming be be my home will know that bank account even exists. Data cuts after Switz. They are not sending info to UAE.

They can still use other information, it's not like they can only send info to the country you declared when you signed up for the account.
It's also not a very good strategy to rely on lack of information exchange. What if Switzerland changes the rules tomorrow and decides to report for previous years as well?

 

[hortm]

I don't understand why in this day and age people still talk about "home countries". I left my "home country" when I was 18 years old.



Irrelevant - could become liable for tax much sooner.



Some countries may do that, but it's not relevant. You can be tax resident in multiple countries at the same time, and you can be liable for taxes without being tax resident in a country.



That's really funny because neither Sweden nor Germany have a tax treaty with the UAE, so they won't give two shits about a TRC from the UAE.



That's not even required to get a TRC.

I'm amazed how much wrong information you could cram into such a short post.



They can still use other information, it's not like they can only send info to the country you declared when you signed up for the account.
It's also not a very good strategy to rely on lack of information exchange. What if Switzerland changes the rules tomorrow and decides to report for previous years as well?

If Switz report to UAE than, most probably, nothing will happen. UAE will throw data away.

Do you know what exactly other information is shared? I think nothing is shared if BO's name on account is not used (entity used).

I have spoken with private bankers in US and Switz - they told they are not reporting to UAE, Bahrain, etc. UAE, Bahrain are reporting to them via CRS auto ex., Fatca.

 

[meze99]

If you spend your time in those countries as a tourist (no resident permit) and don't use/open local bank accounts it should work (90 days EU -> 90 days Georgia -> 90 days Thailand -> 90 days elsewhere (Bahamas for example).
However there are known cases when swiss banks leaked and databases were bought by tax authorities.

 

[JustAnotherNomad]

90 days is plenty enough to make you tax resident in several EU countries. Whether you have bank accounts there or not is not relevant.

 

[hortm]

Guys, why does it matter at all? Get back to my question above. Switz is not in EU. Data shall not come to EU even if some country shall start claiming I am tax resident there (IMHO, very low chance).

 

[meze99]

Data comes when you cross borders even if you managed to beat CRS.
I never heard about tourists who rented a villa for 3 months being taxed in EU.

 

[TheCryptoAnt]

So far you move around often enough and you are no more than a tourist its ok.

 

[JustAnotherNomad]

I never heard about tourists who rented a villa for 3 months being taxed in EU.

Not EU, but Switzerland has 90 days, potentially less than that because "short absences" don't even count. So you spend 13 weeks in Switzerland, Monday-Friday, that's just 65 days, but you could become tax resident.
Would they catch you and really and come after you? Probably not. Especially not if you have closer ties to another country and there's a tax treaty.
Other EU countries have something like 270 days in a rolling 36-month period as a limit, which also comes down to 90 days per year. And just like Switzerland, short absences often aren't counted.
Again, you could probably stay under the radar quite easily, but this could absolutely happen, especially if it's your home country.

And then obviously there are crazy examples like Germany where simply having access to an apartment (the possibility to use it whenever you want, whether you actually spend time there or not, whether you are registered as a resident or not) can trigger tax residency.

 

[hortm]

Data comes when you cross borders even if you managed to beat CRS.
I never heard about tourists who rented a villa for 3 months being taxed in EU.

I am talking about bank account data. How in countries I visit they even know about existence of the account?

 

[JustAnotherNomad]

https://www.aldic.net/crs-indicia-search-to-determine-the-residence/

@Martin Everson has posted CRS documentation earlier.
You seem very worried about this for someone claiming not to only visit those countries as a short-term tourist.
I wouldn't want to rely on such a setup, where you hope they won't find you.

Also, people have been caught based on card transactions alone:

Speedboat among £5.1m of assets seized in tax fraud investigation

British woman arrested and warrant issued for arrest of Dutch man over allegations of money laundering and tax avoidance

www.theguardian.com

 

[hortm]

But this is easy to avoid and 99% of swiss banks will not go for it. About me - I am worried because I may forget something and become something more than long term tourist, but that will be very vague in my case. Anyway - data direction is Switzeland-UAE, so I do not think that is relevant.

Check article -

Reporting Financial Institutions tell the OECD where to stick their CRS anti-avoidance residence-by-investment recommendations.

Very few banks adopt the OECD recommendations in piercing residence by investment schemes to avoid the CRS. As the client has permanent homes in several jurisdictions, the bank should focus on the OECD Model Convention tie-breaker rules based on Centre of Vital Interest.

www.linkedin.com

The conclusion is at the bottom

 

[TheCryptoAnt]

I am worried because I may forget something and become something more than long term tourist

but how?

if you have no place in your name neither rented nor bought, no local bank account, no local phone number, no local insurance...
how am you really living in that place?

 

[hortm]

but how?

if you have no place in your name neither rented nor bought, no local bank account, no local phone number, no local insurance...
how am you really living in that place?

I am also thinking this is unlikely. Even if I buy real estate. I can register all valuable stuff on relative who clearly lives in some other place.