Cyprus or UAE for me? (Low income btw...)

[itsmemario123]

He is talking about a contract with a client. You cannot do much "reinvestment" in that sense. You can invest in assets, but they do not lower your profit.

Exactly. I only know to earn money with my work as a freelance and that's it, so if I don't invest in a cloning machine I don't know what to do... xD

The best option he has is to be resident in two countries while travelling and then claim the travel expenses in both countries.

That's the maximum I can do, yeah, but I want to save money so I can't spend everything on travels. The problem is the money I save and get as salary/dividends.

 

[itsmemario123]

Just bumping. I think that I understood UAE. What about Cyprus?

 

[daniels27]

Is it just one client?

 

[itsmemario123]

Is it just one client?

2 clients, but one is like 90%.

 

[daniels27]

@Marzio how about this setup? He sets up 1 UK Limited that he uses for invoicing. It he makes 100k per year, he invoices 33k from a self-employment in Czechia, 33k from a self-employment in Bulgaria and 33k from Romania. Leaving 1k taxable at 19% in the UK.

Let's say he has travel expenses amounting 30k per year, he deducts all of them in all three countries, leaving him with personal income of 3k in each Czechia, Bulgaria and Romania?

 

[itsmemario123]

@Marzio how about this setup? He sets up 1 UK Limited that he uses for invoicing. It he makes 100k per year, he invoices 33k from a self-employment in Czechia, 33k from a self-employment in Bulgaria and 33k from Romania. Leaving 1k taxable at 19% in the UK.

Let's say he has travel expenses amounting 30k per year, he deducts all of them in all three countries, leaving him with personal income of 3k in each Czechia, Bulgaria and Romania?

Ah woah hahahah. Personal income of 3k has no taxes? Didn't knew that.

 

[Cloudbanck]

Not required, but can I still do so? So I have the documents.

The UAE has two different tax residency certificates, one for domestic use that only require a 90 day stay, and one "international" for double taxation purposes requiring "the individual to be physically present in the UAE for more than 183 days in a 12 month period". I guess it's the latter you need for Spain. Bit of paperwork to get it done, costs about 1,000 AED, and it's only valid for a year, but doable. Not sure if you need a tax residency certificate every year, or just once.

See https://kpmg.com/ae/en/home/insight...dent-and-tax-residency-certificate-guide.html

And the official UAE gov site https://tax.gov.ae/en/services/issuance.of.tax.certificates.aspx

Staying over 183 days, of course means you are in scope for effective management and control rules, but that is as mentioned potentially avoided by having board meetings with minutes and executive decisions taken outside the UAE. Or well, just accept that your foreign business is under UAE jurisdiction.

That's really interesting. So if I get a better contract (which I hope), I can still optimize it. Thanks a lot for this input.

Ok, thank you a lot for all this info. I thought that if you register the company on a free zone, you just pay about 6k flat per year and that's it.

So having a USA LLC, and somehow being able to get the tax certificate from UAE (I have to looks into that) looks like the best plan for me now.

One thing to note is that many people use their UAE company to get residency in the UAE. With a US LLC and no UAE company, you have to find another route. An obvious one is as a remote "virtual" worker , you can get residency if you are an employee anywhere in the world or have your own non-UAE business as long as you can show you earn at least 3,500 USD (or equivalent) per month. It's very cheap but has to be renewed every year.
Otherwise you can get 2 year residency by purchasing a property in the UAE for at least 750,000 AED (or 2M AED for 10 year golden visa). It can be renewed every 2 year as long as you still have the property. Or getting 2 year residency by being a freelancer (but that s much more expensive than being a remote worker)

 

[daniels27]

Ah woah hahahah. Personal income of 3k has no taxes? Didn't knew that.

It has, but how much can it be?

 

[itsmemario123]

The UAE has two different tax residency certificates, one for domestic use that only require a 90 day stay, and one "international" for double taxation purposes requiring "the individual to be physically present in the UAE for more than 183 days in a 12 month period". I guess it's the latter you need for Spain. Bit of paperwork to get it done, costs about 1,000 AED, and it's only valid for a year, but doable. Not sure if you need a tax residency certificate every year, or just once.

Ok, I have to look this closer, as I'm going to be a non-dom so maybe the 90 is enough? My last tax residency is going to be Romania.

One thing to note is that many people use their UAE company to get residency in the UAE. With a US LLC and no UAE company, you have to find another route. An obvious one is as a remote "virtual" worker , you can get residency if you are an employee anywhere in the world or have your own non-UAE business as long as you can show you earn at least 3,500 USD (or equivalent) per month. It's very cheap but has to be renewed every year.

This one fits me. Good to know.

Otherwise you can get 2 year residency by purchasing a property in the UAE for at least 750,000 AED (or 2M AED for 10 year golden visa). It can be renewed every 2 year as long as you still have the property. Or getting 2 year residency by being a freelancer (but that s much more expensive than being a remote worker)

This one not that much haha.

Seems that UAE fits somehow. I guess that at this point I need to talk with an advisor, but at least I know that there's a way.

 

[itsmemario123]

It has, but how much can it be?

Ah ok I understand the point now.

 

[W Fish]

I'm saving the money to buy properties, but the properties are going to be in my personal name, not the company name.

How does this make any sense?
In an environment where corporate tax is low to zero, it does not make any sense to move investment items or even large consumption items out of the company.

Use a company car, rent out company houses or flats, etc...
You can easily live in an "office".

As soon as you want to put something in your own name you have to pay tax and with your numbers the elaborate offshore schemes are likely not economical.

Take out (officially) only the minimum that you have to for things to look legit. Probably not more than average salary.
Most of what you spend, you can get out via expense invoices - look at signature.

 

[itsmemario123]

How does this make any sense?
In an environment where corporate tax is low to zero, it does not make any sense to move investment items or even large consumption items out of the company.

Use a company car, rent out company houses or flats, etc...
You can easily live in an "office".

As soon as you want to put something in your own name you have to pay tax and with your numbers the elaborate offshore schemes are likely not economical.

Take out (officially) only the minimum that you have to for things to look legit. Probably not more than average salary.
Most of what you spend, you can get out via expense invoices - look at signature.

The problem with this is that in Spain is difficult to have fake company expenses. For example, most freelancersin Spain buy the work car as 50% for the job and 50% personal, because if you buy the car claiming that is 100% for the job, Hacienda (the tax bureau) is going to investigate that you never use that car on a weekend (for example) for your personal things: https://www.selfemployedspain.com/is-the-renting-of-my-vehicle-deductible-if-i-am-a-self-employed/

If I work at home, I have to declare the % of the office that I use for work to declare the same % of the renting and utility bills as expenses.

They say that Spain is tough for a reason :-/ and I want to sleep without worries. As I said I'm not planning to live as a millionaire, simply that I want to optimize my personal income while I travel until I decide to return to Spain, because I'm not sure about my future, but if all my life goes like it is going now, I have no problem paying half the salary to Spain as I'm not a big spender nor have kids. My nephews are the ones that are going to benefit from my leftovers haha.

In short, I just want a way to travel around while optimizing my personal taxes. I'm not planning 0%. I'm Happy with Romania's 13% (as Spain will be about 25%), but maybe there's something better than 13%.

 

[itsmemario123]

How does this make any sense?
In an environment where corporate tax is low to zero, it does not make any sense to move investment items or even large consumption items out of the company.

Use a company car, rent out company houses or flats, etc...
You can easily live in an "office".

As soon as you want to put something in your own name you have to pay tax and with your numbers the elaborate offshore schemes are likely not economical.

Take out (officially) only the minimum that you have to for things to look legit. Probably not more than average salary.
Most of what you spend, you can get out via expense invoices - look at signature.

But thinking about this (I've just read your signature) you can't imagine the amount of people that ask for B money when buying properties. We'll talk.

 

[daniels27]

The problem with this is that in Spain is difficult to have fake company expenses. For example, most freelancersin Spain buy the work car as 50% for the job and 50% personal, because if you buy the car claiming that is 100% for the job, Hacienda (the tax bureau) is going to investigate that you never use that car on a weekend (for example) for your personal things: https://www.selfemployedspain.com/is-the-renting-of-my-vehicle-deductible-if-i-am-a-self-employed/

This is the same for most places in Europe. Cars are a personal thing. If you need it for the company, you rent. All else will cost you more in documentation than you will ever get out.

 

[JustAnotherNomad]

Where do you want to live? How much tax would you be OK with?
There are many options in your income range. Czechia could be an option, for example. Or Malta.
If UAE, I would consider a US LLC, UAE entities are a headache and they currently don't enforce corporate tax for offshore companies.

 

[daniels27]

If UAE, I would consider a US LLC, UAE entities are a headache and they currently don't enforce corporate tax for offshore companies.

With 100k per year options are limited. UAE is possible but not the Ferrari lifestyle.

 

[JustAnotherNomad]

With 100k per year options are limited.

I wouldn't say so. For example, Czechia has an attractive freelancer tax model, where you pay only 15-20% or so.
If you earned more than 100k, the tax would go up and Czechia would become unattractive.

 

[daniels27]

I wouldn't say so. For example, Czechia has an attractive freelancer tax model, where you pay only 15-20% or so.
If you earned more than 100k, the tax would go up and Czechia would become unattractive.

Yes. I agree. Anywhere in the EU is no problem. If he reads my recommendation, he can do Czechia & Romania & Bulgaria all together. I meant that most people here do not recommend UAE in his case (although I think I could live there with much less than 100k).

 

[JustAnotherNomad]

UAE works, it's just a matter of lifestyle, that's why I asked where OP wants to live.
If you want nature, Czechia would be a better place than UAE. UAE would be less tax, but higher cost of living. Probably what you have left at the end of the month would be comparable.

 

[Matade]

I'm a EU citizen earning no more than 100k USD yearly with my business. Is not that much compared to you in this forum... but is my hard work and still I'm trying to optimize it.

100k a year is not much?
LMAO, humblebrag or what?
That's high income lol