Losing tax residency from aggresive country

[lemonade]

Would moving to Estonia for 3 months and then moving to Cyprus for the rest of the year help me lose tax residency from an aggresive country?
I have to notify where im moving and if I move to Cyprus directly, tax residency would be disputed by my current country.
Im from outside EEA, so it would require to incorporate an Estonia company + visa but income would go to personal account in Estonia.
My goal is to incorporate in Cyprus

 

[brianK]

Why not just set up an address through a service like Clevver and use that when you deregister yourself from your aggressive home country? That’s exactly what I did, and just like that, I disappeared from the radar.

I don’t even have that address active anymore.

 

[Don]

Would moving to Estonia for 3 months and then moving to Cyprus for the rest of the year help me lose tax residency from an aggresive country?
I have to notify where im moving and if I move to Cyprus directly, tax residency would be disputed by my current country.
Im from outside EEA, so it would require to incorporate an Estonia company + visa but income would go to personal account in Estonia.
My goal is to incorporate in Cyprus

Ideally, you should obtain a tax residence certificate, so you need to get a residence permit and not just a visa.
In Estonia, as soon as you get a residence permit, you can immediately get a tax residence certificate from day one, but it doesn't work like this with just visas or based on visa-free stay.

Why not just set up an address through a service like Clevver and use that when you deregister yourself from your aggressive home country? That’s exactly what I did, and just like that, I disappeared from the radar.

I don’t even have that address active anymore.

It might have worked for you, but it might not apply to anyone. I would be cautious.

 

[uplana]

@lemonade what is this agressive country, mind to say ?

 

[Cloudbanck]

This is hard to answer without knwoing which country's tax net you are trying to leave. But there arent that many aggressive tax countries outside the EEA, so Im guessing Brazil, Australia, or Canada.

But yes, for countries with anti tax haven rules, it is a good strategy to first register as having moved to a non tax haven country, and after that you can do whatever you want. And this non tax haven country can be a messed up third world country actually - mostly NGO ppl, development bank and diplomats register in such countries, so it doesnt raise any eyebrows. And the third world country is typically not going to cooperate with any external authorities, nor keep track of you very much.

 

[daniels27]

Why not move to a free residence country first? If Canda, you move to the US. If Australia, go to New Zealand. If Brazil, go to whatever neighbour you like there. It makes all easier to handle if you do not need a visa.

Also, personally. I do not understand the objective. If you want to live in Cyprus, it won't be contested if you are actually there. If you don't want to live there, then why not chose Paraguay, Somalia, Eritrea or something in this area as @cloudbank suggested?

 

[lemonade]

Country is Mexico, they created this 5 year sticky tax residency law and have become really aggresive and might come up with other dumb stuff next year. So you can leave and live in Cyprus or other place but you would be tax resident in MX for 5 years, they also claim your tax residency if not residing somewhere else.

They have some DTT that might be a work around it and from those Estonia is the easy and cheap route, the others are too expensive for me. I cant use an USA LLC because they also cut that route, some years ago you could acumulate and dont pay anything but now they consider it personal income.

Using a MX corp would be like 50%-60% effective tax rate and is a mayor PIA. There is a 2.5% tax regime for individuals under some rules that I cant use.

I need the long stay permit to be able to get the residency and then open personal bank account since getting one from outside EEA is troublesome.

I have WISE but dont want to trust them all of my income.

 

[Don]

Country is Mexico, they created this 5 year sticky tax residency law and have become really aggresive and might come up with other dumb stuff next year. So you can leave and live in Cyprus or other place but you would be tax resident in MX for 5 years, they also claim your tax residency if not residing somewhere else.

They have some DTT that might be a work around it and from those Estonia is the easy and cheap route, the others are too expensive for me. I cant use an USA LLC because they also cut that route, some years ago you could acumulate and dont pay anything but now they consider it personal income.

Using a MX corp would be like 50%-60% effective tax rate and is a mayor PIA. There is a 2.5% tax regime for individuals under some rules that I cant use.

I need the long stay permit to be able to get the residency and then open personal bank account since getting one from outside EEA is troublesome.

I have WISE but dont want to trust them all of my income.

It can work, yes..
You can try an Estonian company with a PE in Cyprus.
Operate the company from Cyprus but keep management of the company and personal tax residency in Estonia.
Then you just pay 12.5% CIT in Cyprus and no tax on a personal level.
This can be a highly efficient setup and somewhat easier than qualifying for personal tax residency in Cyprus, as you don't need to really reside in Estonia to get a tax residence card. As soon as you have your residence card, you can also get a tax certificate based on the Estonia-Mexico double tax treaty.

 

[sebastian]

It can work, yes..
You can try an Estonian company with a PE in Cyprus.
Operate the company from Cyprus but keep management of the company and personal tax residency in Estonia.
Then you just pay 12.5% CIT in Cyprus and no tax on a personal level.
This can be a highly efficient setup and somewhat easier than qualifying for personal tax residency in Cyprus, as you don't need to really reside in Estonia to get a tax residence card. As soon as you have your residence card, you can also get a tax certificate based on the Estonia-Mexico double tax treaty.

Interesting setup, but how solid is this structure in practice when it comes to scrutiny from either Estonian or Cypriot tax authorities?

Have you or anyone you know used this model long term without issues?

 

[lemonade]

I found that it might be cheaper to get a Czech republic long term visa, 15% tax first €67k, 23% over it.
An estonian digital nomad visa with a Cyprus company could also work while living in Estonia.

 

[Davis123]

You all need to be aware that by 2030 EU plans to introduce a CBT style system same as USA. Plan on getting a second citizenship but be careful in getting a second one that might get same ideas introducing lower tax CBT.

 

[Koedam]

You all need to be aware that by 2030 EU plans to introduce a CBT style system same as USA. Plan on getting a second citizenship but be careful in getting a second one that might get same ideas introducing lower tax CBT.

The EU has no say in the taxation of Europeans. That responsibility lies solely with the individual member states. It will take a new treaty and unanimous vote. Good luck with that. I think you can't give a serious source where I can read about these plans.

 

[Davis123]

The EU has no say in the taxation of Europeans. That responsibility lies solely with the individual member states. It will take a new treaty and unanimous vote. Good luck with that. I think you can't give a serious source where I can read about these plans.

EU member countries are all salivating and looking at France. Just watch and see my prediction become . I might not be alive by that time but things are moving in that direction. OECD was trying for worldwide taxation reforms for years. But USA was the only one resisting. When President Obama took over everything started with FATCA and then CRS. Just wait and see

 

[Koedam]

As I said: "The EU has no say in the taxation of Europeans. That responsibility lies solely with the individual member states."

France is a member state, so they can decide. They EU can't. France is the only country where it's proposed by a committee, with a left wing chairman. Proposed doesnt mean that the French Parliament adapts it, there is a lot of discussion about it. There is no bill that has been passed or is under consideration in the National Assembly.

I asked for the EU plans for 2030. You don't have them... because they don't exist.

 

[Davis123]

As I said: "The EU has no say in the taxation of Europeans. That responsibility lies solely with the individual member states."

France is a member state, so they can decide. They EU can't. France is the only country where it's proposed by a committee, with a left wing chairman. Proposed doesnt mean that the French Parliament adapts it, there is a lot of discussion about it. There is no bill that has been passed or is under consideration in the National Assembly.

I asked for the EU plans for 2030. You don't have them... because they don't exist.

Don't kill the messenger. Try to research. I dont mind your attack on me as i know before FATCA and CRS came i was attacked on amother forum years ago when I stated this is what will happen within a few years. I was laughed at that time.

Maybe my links would be deleted. Hopefully admin doesn't mind me sharing .

 

[aniglo22]

Don't kill the messenger. Try to research. I dont mind your attack on me as i know before FATCA and CRS came i was attacked on amother forum years ago when I stated this is what will happen within a few years. I was laughed at that time.

Maybe my links would be deleted. Hopefully admin doesn't mind me sharing .

Both happen to sell CBI passports ..

 

[Alonzo]

Don't kill the messenger. Try to research. I dont mind your attack on me as i know before FATCA and CRS came i was attacked on amother forum years ago when I stated this is what will happen within a few years. I was laughed at that time.

Maybe my links would be deleted. Hopefully admin doesn't mind me sharing .

Those are clickbait drama videos to gain money off of viewers like you. You are the kind of guy to believe every financial advise on tiktok

 

[Davis123]

Those are clickbait drama videos to gain money off of viewers like you. You are the kind of guy to believe every financial advise on

Those are clickbait drama videos to gain money off of viewers like you. You are the kind of guy to believe every financial advise on tiktok

Well never say never. All countries are getting greedy. France was the first one. Let's see what future holds. OECD was trying for years to get CRS but it took Obama to approve FATCA then CRS followed. Andrew Henderson was warning about CRS as he himself exited the US and renounced his own citizenship.

 

[lemonade]

It seems that every country requires an owned foreign company and a proof of income 3+ months for a long term permit/digital nomad visa, except NL

 

[lemonade]

It can work, yes..
You can try an Estonian company with a PE in Cyprus.
Operate the company from Cyprus but keep management of the company and personal tax residency in Estonia.
Then you just pay 12.5% CIT in Cyprus and no tax on a personal level.
This can be a highly efficient setup and somewhat easier than qualifying for personal tax residency in Cyprus, as you don't need to really reside in Estonia to get a tax residence card. As soon as you have your residence card, you can also get a tax certificate based on the Estonia-Mexico double tax treaty.

How would Estonia grant me a long stay permit? Its required to rent and establish personal tax residence, the digital nomad visa requires a foreign corp and the startup visa looks like doesn't apply to my case. Or can you get the personal tax residence card by having an estonian company? Would that card be enough to cover with Mexico?
I see that they require a livable residence but wouldn't I have to be there 183 days? Or is there a way to get it in like 3 months, send proof to Mexico and then move to Cyprus.

Can I incorporate in Cyprus, open a business bank account, move to Estonia and then receive salary/dividends or would they screw me?