In which countries are taxes not paid?
Yes. As amazing as it may seem, there are countries in the world where you don't pay taxes.
They are called “Tax Free” states and do not apply income taxes.
Some of these countries have in fact cut waste, and derive money for public services from other sources (for example indirect income or by attracting foreign investment).
In this peculiar historical moment, many people are looking for a country to move to to escape from western tax burden and problems, and most suffer the feeling of paying a lot and receiving little; the western companies that also operate with foreign countries, are also penalized (depending on the higher costs) in international competition, with respect to companies located in other best countries, without any intense tax burden.
However, a fundamental distinction must be made. It is one thing to talk about countries with subsidized taxation (or privileged or low), it is quite another to talk about countries where taxes are not paid.
Today we talk about the seconds.
Here are some examples of Tax Free Countries (in addition to the many other Tax Free Countries we have talked about in previous articles or videos):
THE PRINCIPALITY OF MONACO:
If you're not planning on moving too far from Europe, Munich could be an interesting option.
In fact, it is the only country in Europe where no taxes are paid on the income of individuals.
This is valid for all natural persons with the exception of residents of French nationality.
With regard to corporate taxes, however, a distinction must be made between:
- Businesses carrying out commercial or industrial activities that generate the majority of the income in Monaco, in this case are exempt from direct taxes.
-Companies that invoice at least 25% of business income outside the Principality, which instead are subject to a tax rate of 33.33%.
As for capital gains and interest, there is no taxation.
From the very beginning, Monaco has been a tax-free country. This means that, for the most part, the taxman will leave you alone, as long as you are not a French citizen.
The caveat is that you have to actually move, you can't just have a paper residency. You need to live there.
But this may not be considered a sacrifice at all!
Monaco is the second smallest country after the Vatican, with a population of around 38,000.
The vast majority of the people who live there have been particularly successful in life from an economic and / or entrepreneurial point of view.
So if it is important for the growth of your business to establish business relationships with successful people, living in the principality will allow you to live in an environment where these relationships can be easily established, where these people are almost all your neighbors, or the people in line behind you at the supermarket or next to you at the happy hour, or the parents of the children who go to school with yours.
That said, this exclusivity comes at a high price, especially when it comes to the cost of the apartments.
And it's not just the cost of living. To live in this beautiful southern Mediterranean country, you need to put half a million euros into a bank account in your name. This amount cannot be touched during the duration of the residence permit.
Then, after ten years, you will receive your permanent residence.
This option is primarily designed for people with very high net worth who would not mind leaving several million euros in the bank to avoid paying millions in taxes.
THE BAHAMAS
If you have no problem moving out of Europe and the Caribbean has always been your dream, this might be a good choice.
If you proceed to transfer your residence to the Bahamas you will not have to pay any taxes on personal income (such as income from salary or pension), nor on capital income. Neither is there any tax on assets or inheritances or donations.
The only type of applicable taxes are indirect ones (such as VAT). The applicable VAT rate is 10%.
Moving to the Bahamas is the perfect choice if you want to move with your family, if you are a retiree or even an entrepreneur interested in carrying out his business abroad, perhaps remotely, in smart working mode.
As for current accounts, you won't have any particular problems finding one. In fact, an important part of the economy of these islands is characterized by offshore banking services. This is because the tax exemption is one of the elements that pushes many people to consider opening an account in the Bahamas but also offshore brokerage accounts.
THE CAYMAN ISLANDS
The Cayman Islands represent one of the leading offshore countries in the world.
Also in this case, moving here is an advantageous choice if you want to move with your family, if you are a retiree or even an entrepreneur.
In fact, if you move your business to the Cayman Islands, your income will be completely tax-free.
If you proceed to transfer your residence to the Cayman Islands, you will not have to pay any taxes on personal income (such as those deriving from salary or pension), or on capital gains. Neither is there any tax on assets or inheritances or donations.
The only type of applicable taxes are indirect ones (such as VAT).
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These are just a few examples of countries where you really don't pay income tax. Another zero-tax country, for example, is the UAE.
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