Lump-sum tax program for traders

[orientalc]

There are special tax programs offered by Italy and Switzerland that let you take residence in these countries and pay fixed tax annually(100-400k EUR). Do these programs cover income from daily crypto/stock trading or it will be additionally taxed?

 

[StoredValue]

Not able to answer this, though I could recommend Andorra. They do not tax the sale or purchase of stocks, effectively making 0 tax for day traders.

 

[AlbanyJames]

I believe Greece is offering (or announced) this for 100k euro per year also.

 

[Konstanz]

100k eur + / year is very very expensive. You can rent luxury apartment for that in Monaco or Dubai for the same price and pay no tax for trading at all.

 

[Silvio]

100-400k/year is a lot to pay, there are much cheaper alternatives. Cheaper to move to a territorial tax country and make sure your brokerage account is outside of that country

 

[GrumpyMess]

there are much cheaper alternatives.

What alternatives in Europe?

 

[Silvio]

In Europe - Cyprus, Malta, Monaco. But some options will be expensive - you'll need to pay rent etc.

 

[dlttrading]

I can recommend Cyprus. They have the 60 days rule what means you need to have an rented or owned apartment for the whole year but you need only to stay for 60 days on the island. Because of Corona there will be plenty of nice cheap rental flat available because Airbnb Season is lost because of Corona. Cyprus is first world country with nice climate and very professional law firms etc. This setup will cost you maximum 10-20k per year and you have a nice flat included where you can stay all the year (if you like). Cyprus is EU and because of that you have a lot of legal certainty and can use most EMI-Banks from EU as I do not recommend cypriot banks.

If you have questions or need some motivated local services (lawyer, accountand, company formation, help for residency) than you can write me

 

[orientalc]

Thanks for your comments. And yet my question wasn't answered. What I'm looking for is a tax regime with easy tax reporting because it can be real pain in the a*s if you do dozens trades a day or thousands per year (daily trading). And also where crypto/stock trading is not additionally taxed if it is your only source of income

 

[dlttrading]

Thanks for your comments. And yet my question wasn't answered. What I'm looking for is a tax regime with easy tax reporting because it can be real pain in the a*s if you do dozens trades a day or thousands per year (daily trading). And also where crypto/stock trading is not additionally taxed if it is your only source of income

In Cyprus this should be free so you don´t need to declare each trade. You just declare your profit and you should have 0% tax on it. At least a lot of people do it like that. Never heard about problems.

or

use an offshore company from country without accounting needs (belize etc.) You do all your trade in the name of the offshore company . Than you withdraw dividends to you when you live in cyprus because Cyprus has 0% tax on dividends (even when the dividend comes from offshore company )

Cyprus tax regime is very very good for immigrants who get yellow slip.
The EU will force Cyprus to stop this in the future but all issued residencies and their benefits will stay for 17 years. this is the best deal in whole europe. Think about it because soon this will be definitly stopped so you can still get the residency and take advantages for next 17 year. Especially because of Corona EU will need more money and will lookout for everything what lower their tax incomes in high tax countries in EU.

 

[GrumpyMess]

use an offshore company from country without accounting needs (belize etc.) You do all your trade in the name of the offshore company . Than you withdraw dividends to you when you live in cyprus because Cyprus has 0% tax on dividends (even when the dividend comes from offshore company )

How about "A tax resident company is a company whose management and control is exercised in Cyprus"?

 

[dlttrading]

How about "A tax resident company is a company whose management and control is exercised in Cyprus"?

This is tricky question. As I know CFC Rules don´t apply for people who received yellow slip before 2019 or 2020. The special Non Dom Status gives you the privilege that you can run offshore company from Cyprus. But I am not that expert to answer this

Or better just do it without offshore and trade privately because this is also tax free in Cyprus.

 

[Sols]

If you go by the letter of the law, any offshore company controlled by a resident in Cyprus is tax resident in Cyprus.

In reality, no one is bothering non-domiciled residents (foreigners) who don't pay local tax on their offshore companies. There are many reasons why this is or may be, but for the moment, it's generally considered safe but probably not entirely legal to live in Cyprus, have an offshore company, and not pay any tax. A lot of larger, international businesses run parallel entities: one in Cyprus which pays local salaries to employees and is used to obtain work permits for non-EU citizens and another, offshore which pays additional salaries under the table and pays no corporate tax.

However, more and more are opting to form a local company in Cyprus. As a non-domiciled resident, if you own a local Cypriot company, you can normally get away with paying the 12.50% corporate tax and then pay yourself tax free dividends. There are some caveats to consider so make sure you work with a qualified adviser but that's the general gist of it.

 

[Camille Württemberg]

There are special tax programs offered by Italy and Switzerland that let you take residence in these countries and pay fixed tax annually(100-400k EUR). Do these programs cover income from daily crypto/stock trading or it will be additionally taxed?

Italy is 100k€ per annum and 125k€ for a couple, you then pay 0% on all income and capital gain, everywhere in the world, Italy included, crypto included, etc.
The Swiss "forfait" is getting more and more difficult to get but doesn't need to cost up to 400k€, it typically costs the standard income tax on your annual expenses and that's something you negotiate once with a locality in Switzerland.