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Residence for bank account and offshore company
- Thread starter fuorissimo
- Start date
In general, that is a lot more work for the bureaucrat than just ignoring that which they have no hope of taxing.
Specifically on Paraguay ... there is no issue.
Residency is easy in Paraguay but not the banks. First there is USD +/-3% Deposito/extraccion moneda extranjera en efectivo fee (2.5% EUR) charge for each deposit in foreign currency. Then they evaluate each incoming deposit manually. Normally they allow the first transfer come through but second results in immediate account closure, funds frozen until invoices provided, then returned to originating bank. USD10k is considered a large deposit for local branch of major Brazilian bank.
New accounts require US tax forms and Equifax report pull.
New accounts require US tax forms and Equifax report pull.
Yeah, pretty much agree with Artemis. It leads to nowhere.
It's still a valid question so let's speculate "what if". What if a CRS amendment is made with a new requirement imposed on receiving country to report back to a foreign Financial Institution about non-resident status?
First, it's an asymmetrically costly move, and immediately, the no-tax countries would have leverage over high tax communist bungholes to ask for direct compensation for administrative work.
Assuming the amendment gets implemented anyhow:
1. The bank deems your current residency invalid and asks you to re-certify for the purpose of CRS. You say that to the best of your knowledge, you have no other (tax) residencies at this point. The bank closes your account because the risk is higher. You transfer your funds to another account.
2. The same as above, but the bank also takes a shot from the hip and relays a CRS report you to your country of birth (citizenship), just in case. So what? You're registered as non-resident in your country of birth as well.
What other mean things can they do? You live in Country C and they have no documentation that links you to Country C. If they close the account, it's not the end of the world either. If you're a landlord in your proxy residency country (although registered as non-resident), you can keep opening new accounts in other banks or other countries with your recent Proof of Address document (utility bill) at any time you see fit.
Can your proxy residency country fine you for doing so? At worst, they can invalidate your ID, but you can threaten to "liquidate your property investments xD". PS! You can open a domestic bank account in your proxy residency country using your proxy residency documents, with a legitimate connection to country as a property investor. You need to collect rent from your property investment. What leverage do they have to close this domestic account that has a legitimate requirement to exist? After all, the property taxes and local rental income taxes are paid.
And lastly, what laws would the Financial Institution break if they let you keep your account if the documents are valid? They know you do not pay income tax in your CRS report destination country, or in any other country, yet they have all the documents the laws ask them to collect in regards to CRS. Is there a risk of getting fined for accepting clients that do not pay income tax anywhere? If yes, what about those poor corrupt sell-out politicians who now live in Monaco?
It's still a valid question so let's speculate "what if". What if a CRS amendment is made with a new requirement imposed on receiving country to report back to a foreign Financial Institution about non-resident status?
First, it's an asymmetrically costly move, and immediately, the no-tax countries would have leverage over high tax communist bungholes to ask for direct compensation for administrative work.
Assuming the amendment gets implemented anyhow:
1. The bank deems your current residency invalid and asks you to re-certify for the purpose of CRS. You say that to the best of your knowledge, you have no other (tax) residencies at this point. The bank closes your account because the risk is higher. You transfer your funds to another account.
2. The same as above, but the bank also takes a shot from the hip and relays a CRS report you to your country of birth (citizenship), just in case. So what? You're registered as non-resident in your country of birth as well.
What other mean things can they do? You live in Country C and they have no documentation that links you to Country C. If they close the account, it's not the end of the world either. If you're a landlord in your proxy residency country (although registered as non-resident), you can keep opening new accounts in other banks or other countries with your recent Proof of Address document (utility bill) at any time you see fit.
Can your proxy residency country fine you for doing so? At worst, they can invalidate your ID, but you can threaten to "liquidate your property investments xD". PS! You can open a domestic bank account in your proxy residency country using your proxy residency documents, with a legitimate connection to country as a property investor. You need to collect rent from your property investment. What leverage do they have to close this domestic account that has a legitimate requirement to exist? After all, the property taxes and local rental income taxes are paid.
And lastly, what laws would the Financial Institution break if they let you keep your account if the documents are valid? They know you do not pay income tax in your CRS report destination country, or in any other country, yet they have all the documents the laws ask them to collect in regards to CRS. Is there a risk of getting fined for accepting clients that do not pay income tax anywhere? If yes, what about those poor corrupt sell-out politicians who now live in Monaco?
I opened a non-resident personal account in Luxembourg with those documents and Proof of Address.
The key citizenship requirement is to live in the country for 6 months of the year for any consecutive 3 years. Leaving and living elsewhere will keep your residency permit active but not keep the naturalization clock ticking to your advantage, unlike what some salesmen may say. I still find it pretty good for a non-paid citizenship program. And yes, citizenship is not something they deny to expats who actually live here.
If I did not want to live in Paraguay, I'd get one of the paid citizenships from the Carribean instead - easier, faster (4-6 months timeline, not 36+ as in PY), and the 100K - 200K USD price tag is not unreasonable if you think what other things you could do with your time elsewhere. It's never worth it to live in a country you do not like, possibly not being as productive, just to save a bit of money.
"I opened a non-resident personal account in Luxembourg with those documents and Proof of Address."
... Pardon, "those documents" means Paraguayan ID and Paraguayan Driver's license. Better banks tend to ask for a second ID.
... Pardon, "those documents" means Paraguayan ID and Paraguayan Driver's license. Better banks tend to ask for a second ID.
LOL, yes! You shouldn't bank in Paraguay more than what you can afford to lose. Just bank what you need for your residency and local daily expenses. It's a very small country without real economic backbone. It doesn't take much to collapse the entire banking system. Most of your funds should be invested, and cash savings kept offshore
I agree, we have seen endless threads on this forum where people report they got a second citizen passport from Panama!
I can confirm that the banks there are difficult ... very. In fact I would just skip the banks and go directly to 2nd division:
https://www.fpj.com.py/https://www.interfisa.com.py/index.phphttps://www.tu.com.py/
In practice, residency for anyone born in a country currently requiring Paraguayan visa to enter is almost unattainable. For others, 6 months minimum and 2 trips but in practice it stretches for years and multiple trips.
Citizenship as constitution claims after 3 years but in practice is not granted period, unless you are a football star. Huge moneymaker for local lawyers.
Did you go through this? What issues you encountered? I did not have any issues getting the ID or the driver's license. Born in EU.
I still lack personal experience with PY citizenship, but I'm working towards it.
There is government bank deposit insurance of around USD25k max that pays off quickly... in case of troubles.
In general terms, it is easier to obtain residency for someone who leads clean life in country of birth but they are very easily confused by any slightest incongruity ie if supporting documents that are from different countries or in language other than major euro. Every slightest complication is exploited by the migraciones and lawyers.
Do not count on citizenship, never ever trust lawyers and their periodic invoices.
Why do you value so much opening the bank account using the paraguayan ID? If you use your current passport the address will still be paraguayan and the CRS report will still go there.
Under CRS banks may report you to your country of citizenship if any doubt about your residence arises. (Situation can arise for a number of causes).
Correct. Be very careful and monitor any correspondence that your bank sends you regarding AEOI (some of them will mistakenly include the wrong Tax ID so you better make sure they don't f**k it up)
@Gueco Citizenship is out of scope of CRS, and even if I don't show my passport, banks will ask for citizenship country in the scope of FATCA compliance. They will know my citizenship regardless.
So why bother?
A typical bank employee checking my ID will assume I live in the country which issues my ID. Not every branch representative or relationship manager is going to be proficient in CRS compliance.
Even during account openings, things may go wrong. The front-line banker once handed me a partially filled KYC form where in the place which says "country of residence" she just wrote my EU country of citizenship before asking me where I live. Very helpful of her.
That's why I almost never show my passport, but I do declare my country of citizenship truthfully.
So why bother?
A typical bank employee checking my ID will assume I live in the country which issues my ID. Not every branch representative or relationship manager is going to be proficient in CRS compliance.
Even during account openings, things may go wrong. The front-line banker once handed me a partially filled KYC form where in the place which says "country of residence" she just wrote my EU country of citizenship before asking me where I live. Very helpful of her.
That's why I almost never show my passport, but I do declare my country of citizenship truthfully.
Very few banks will open accounts without you showing your passport. I agree some bankers are retarded and will just assume your residency but almost all of them ask for you TIN number for CRS purposes and there you can write your TIN number from your real residency.
Not all countries have TIN numbers
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