Cut the State out of Your Life by Moving to a Tax Haven Country
The best tax haven country is of course subjective. What could be a perfect place for one person may be a nightmare for others. I’ve discussed frequently here how the whole world can be a tax haven. Provided you don’t stay in your home country year-round the best tax haven country can be wherever you want it to be.
If we’re talking about what I call a pure tax haven country the options are more limited. The beauty of a pure tax haven country is that there is no intrusive form filling. That is one aspect of living in a tax haven that shouldn’t be underestimated. The sheer joy of not having to disclose anything to an overbearing government.
Tell the Government Nothing
I object to the very concept of filling out a tax return every year. I want the government to know nothing about me. You can structure your affairs to pay zero tax in almost any country. But if you’re forced to file a tax return, you’re inviting government bureaucrats into your life.
They can choose not to believe your zero-tax return and open an investigation. That means they may seize your documents and investigate your bank accounts and other assets. This is less likely in countries that welcome foreigners with creative tax schemes but it’s never impossible other than in a pure tax haven.
In a pure tax haven like The Cayman Islands or Monaco the only dealings you should have with the state is to get your residence permit. Other than that, there shouldn’t be much interaction. You won’t be receiving letters and demands for information from any government department.
Leave us in Peace
So, the best tax haven country in the one that leaves you in peace. There are other options from the non-pure tax haven countries. Your unlikely to hear much from the government in a place like Costa Rica. It’s a territorial tax country, meaning you only pay tax on money earned in Costa Rica. Like many countries in Latin America the government is quite ineffectual and doesn’t have the resources to chase after foreign residents to file tax returns, so you’ll be left alone provided you’re not in business in Costa Rica.
The risk is less developed countries if you appear like a wealthy foreigner is a shake down from local government officials. It’s best not to be overly ostentatious and attract attention to yourself.
The Best Tax Haven Country is Wherever Works for You
I don’t think there is a best tax haven. That is for each person to choose. They all have advantages and disadvantages. If you want to live a glamorous, ostentatious life in the best tax haven country in Europe head to Monaco. There’s no tax there at all. After you get your Monaco residence permit nobody will bother you. And everybody’s rich there so no need to hide your wealth. Like everywhere this tax haven country has its disadvantages too which we discussed here.
The Cayman Islands is probably the best tax haven country in the world. It has no taxes at all. It doesn’t even have property tax, which is very unusual, even for a tax haven country.
So there you have it there is no one best tax haven country. Monaco and The Cayman Islands are perhaps the top two. Others will disagree. There are many other places you can live tax free in every corner of the world. When looking for your ideal tax haven country it’s best to spend a bit of time travelling and soaking up the atmosphere in each. Have fun while trying to find the perfect tax haven country for you.
What are the best tax havens?
The optimal tax havens if you’re looking for pure tax havens are Monaco and The Cayman Islands. However there are many other places you can live without paying taxes. It’s possible to live in an otherwise high tax country and pay no tax if you structure your affairs the right way.
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