Question Most/least aggressive tax offices in Europe?

[sriracha]

What are the most/least aggressive tax offices in Europe?

I am referring to, for example:

- making you a tax resident even with less than 183 days (I read this about Spain)
- systematic scanning of ATM withdrawals
- cannot do anything without a tax ID (Italy)
- Artificial Intelligence on card transactions (I read this about France)

and this sort of things, where in less aggressive countries, they either have less rules, or they have the same rules and they are not enforced and you could "fly under the radar" at least for a couple of years, if you stay under the thresholds (5k euro for bank transfers, only small ATM withdrawals etc), don't post yourself on FB in front of your Lamborghini, don't show wads of cash to everybody in town, conduct most transactions in cash etc.

Asking for a friend.

 

[Marzio]

I have asked a few lawyers

Well so their opinions surely counts more than the opinions of a bunch of knuckleheads in a forum.

I tend to agree with them but to be proactive about don't triggering any tax residency questions just rent out instead of buying.

 

[sriracha]

Well so their opinions surely counts more than the opinions of a bunch of knuckleheads in a forum.

I tend to agree with them but to be proactive about don't triggering any tax residency questions just rent out instead of buying.

What are the triggers?

Buying an apartment, for sure. Withdrawing large amounts of cash from ATMS? Getting vehicles in own name?

 

[Marzio]

Buying an apartment

Having a permanent home in your name is the first element that tax administration considers in double tax treaties cases so if possibile it's better to not have one if you don't have strong ties with the other country.

 

[Meta]

Well so their opinions surely counts more than the opinions of a bunch of knuckleheads in a forum.

I tend to agree with them but to be proactive about don't triggering any tax residency questions just rent out instead of buying.

They probably provide good information regarding the laws. I'm also interested in first-hands experience from non-lawyers though. We're certainly on the same page regarding "it's better to not trigger any questions in the first place".

 

[Dexur]

Getlemen, thank you for the valuable information on Spain above. I'll add what I know. I'm thinking of buying a property in Spain, getting a residence permit based on that, but I don't want to become a tax resident there. I'm planning to spend 4-5 months a year there maybe. I have asked a few lawyers, what I gather is that:
1) You may do whatever, they mostly don't care.
2) You may get a letter "Hmm, you look like a resident, why don't you file tax declarations" - unlikely.
3) If you have passport stamps/tickets/etc showing that you don't spend 183 days in Spain + don't have family living in Spain, you are fine. You won't have lengthy discussions regarding "center of economic interests". If you have documents about tax residency in other country, you are certainly golden.

Would love to see comments of individuals dealing with tax office regarding tax residency rules. Cheers!
P.S. Side note, found it fascinating that Switzerland considers you to be a tax resident if you are there on holiday for 90 days per year, or spend just 30 days a year with regard to "gainful activity" (e.g. working/doing business as I gather).

How did it go for you in the end? Did you buy the property? I'm currently thinking about a similar thing - rent and then buy an apartment in Spain, but stay there less than 6 months/year and have tax residency in Romania ( plus a company and another rental/bought property there ).

 

[Meta]

How did it go for you in the end? Did you buy the property? I'm currently thinking about a similar thing - rent and then buy an apartment in Spain, but stay there less than 6 months/year and have tax residency in Romania ( plus a company and another rental/bought property there ).

In the middle of the dial right now. I have found a property that I like, paid the 10% deposit and planning to transfer the remainder in the coming month. Banks and notaries were giving me lots of headache asking for documents. The weirdest thing was "we cannot accept the transfer if no taxes were paid on that money". Geez, ok, but it is my 2023 income! I will file it in 2024 declaration! It took me quite some time to persuade the notary that it's ok. Receiving tax number was slow and cumbersome. Bureaucracy... Overall, everything is fine.

 

[Dexur]

Damn

In the middle of the dial right now. I have found a property that I like, paid the 10% deposit and planning to transfer the remainder in the coming month. Banks and notaries were giving me lots of headache asking for documents. The weirdest thing was "we cannot accept the transfer if no taxes were paid on that money". Geez, ok, but it is my 2023 income! I will file it in 2024 declaration! It took me quite some time to persuade the notary that it's ok. Receiving tax number was slow and cumbersome. Bureaucracy... Overall, everything is fine.

Damn, I've heard it is easy and painless, but I've also heard the horrors of Spanish beer bureaucracy. Good luck with it!

 

[tellerdel]

Germany is the worst by far. If you are a low or medium sized business you will be fcked. Only the large businesses can play around with the tax office as they want.

Story:
A person with a german company had a high-profit business (automation software) with not many employees. Around 200 - 300 k profit a year before tax. He sold his software world wide but had some european customers faking their billing address to save the VAT. The company received a mandatory audit by the tax office and they found it. Tax office now wants to blame it on company because going after a customer for a 50 € invoice missing 10 € VAT in bulgaria is not worth it. Long story short, company was in the right because its IP preset and if someone sets Iraq as their billing address this is not for the company to verify.

Afterwards the company received 2 more audits in those 8 years, totaling 3. Those audits werent "random". Every audit nothing could be found, but thousands were spend for the accountant, lawyer and tax consultant.

Company also had workers. Workers and students worked as normal employees and freelancer because they also had a job. The company was once raided by customs. Customs found out that at some times the workers/students had no job and blamed bogus self-employment. Company needed to pay hefty fines. Also some documents were missing or not fully available. Hefty fines too.

Person fired all employees and moved his company to Dubai. Person never had a headache anymore, saved a lot of money and doesnt get fcked on a monthly and yearly basis.

 

[JohnLocke]

so the lesson of this story is to move to and stay in Dubai!

 

[jafo]

Person fired all employees

Tax gang members hurting innocent citizens again!

moved his company to Dubai. Person never had a headache anymore, saved a lot of money and doesnt get fcked on a monthly and yearly basis.

I love it when a story has a happy ending

 

[Puzel12]

How is the tax office in Poland and Czech Republic? Is it aggresive?

 

[Don]

How is the tax office in Poland and Czech Republic? Is it aggresive?

Poland is really bad from what I've heard.
I haven't done business in this country myself, but know many people who have, e.g., heard of someone who got criminal charges for temporarily keeping a 50 dollar printer that was owned by his business in his home.
They are also quite powerful, if they want to go after someone the methods they use are far from what I would expect from a state institution.
Fines are one of the worst. DAC6 non compliance can cost you up to 5.8 million, while in some other EU countries same thing costs max 3k.
All you need is one person to get angry at you and snitch you to the tax office and you might get into deep trouble.
Legal system is also quite complex and uncertain. People say that when they would speak to 3 different advisers in most case each would have a different opinion.

 

[Marzio]

People say that when they would speak to 3 different advisers in most case each would have a different opinion

This is a constant worldiwide tho.

I have yet to find a country where you speak to different advisors and receive the same answer.

 

[Sols]

How is the tax office in Poland and Czech Republic? Is it aggresive?

There's a reason an author like Kafka came from what today is Czechia. Their bureaucracy has been an abomination for hundreds of years, and it's a part of their history and culture that they hold on to firmly.

They somehow manage to replicate this terrible bureaucracy even when they digitize their systems. It's the same process, except it happens on a computer screen instead of on paper. Still takes just as long.

In other words, the Czech government is in such a sorry condition that tax evasion is rampant and tax laws poorly enforced. But when they finally do catch someone, they tend to not let go easily. A dangerous mix of incompetence and aggression.

 

[jafo]

Poland is really bad from what I've heard.
I haven't done business in this country myself, but know many people who have, e.g., heard of someone who got criminal charges for temporarily keeping a 50 dollar printer that was owned by his business in his home.
They are also quite powerful, if they want to go after someone the methods they use are far from what I would expect from a state institution.
Fines are one of the worst. DAC6 non compliance can cost you up to 5.8 million, while in some other EU countries same thing costs max 3k.
All you need is one person to get angry at you and snitch you to the tax office and you might get into deep trouble.
Legal system is also quite complex and uncertain. People say that when they would speak to 3 different advisers in most case each would have a different opinion.

That's why the gang members of these criminal organizations ...ahem...I meant "public servants", do whatever it takes to keep their names anonymous, otherwise, retribution is career-ending. All it takes is for them to get a "package" at their house.

Life can be so much better for all these cretins if they just became productive members of society instead of lazy parasites

We can change the country's name with any other name and the story pretty much stays the same.

 

[12345]

. A dangerous mix of incompetence and aggression.

Poland is the same from what I have heard from many entrepreneurs
Although personally I had positive experience, maybe I just got lucky...

 

[jafo]

maybe I just got lucky...

... or fell through the cracks. I have a "friend" who knows a lot of businessmen whom the tax authorities don't even know exist. They seem to have found a way to stay off the radar. Not under the radar, BUT completely OFF the radar!

 

[bonox]

They seem to have found a way to stay off the radar. Not under the radar, BUT completely OFF the radar!

mind to share some insides?

 

[jafo]

mind to share some insides?

I wished I knew. I would use it too, but sadly they don't disclose their methods...at least NOT to me...and trust me...I have "inquired"

 

[Don]

... or fell through the cracks. I have a "friend" who knows a lot of businessmen whom the tax authorities don't even know exist. They seem to have found a way to stay off the radar. Not under the radar, BUT completely OFF the radar!

Apparently, up to 12,000 Americans are wrongfully marked dead each year.

If you are officially dead, how will they tax you or hold you legally accountable?

I guess that would be one example of how to be completely off the radar

Imagine doing business in the US being officially dead, while at the same time having multiple other passports.

Reference: Madeline-Michelle Carthen was declared dead 15 years ago. The only problem? She's still alive.