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Residence in Monaco + US LLC
- Thread starter baltic7
- Start date
If I had about 2 million euros in my account, Monaco would be at the top of my list as a place of residence. Since they don't care how you distribute your stay in the principality, it is the perfect place, no taxes but a relative rent that can easily be offset by earning more money.
*AND* you don't have to give them the full 2 million either. Only 500K! You need 2 million maybe to get accepted, but when you pressure the Monégasque bankers AFTER you get your Carte de Sejour, you can leave them with 500K and invest the difference yourself. Every year, I sent my MC bank their returns vs. my returns on the same 500K amount... I've beaten them for the last almost 3 decades just with the BRK stocks every single year
During the first couple of years, they used to write me back & bother justifying their poor performance and fees, but since then, once they realized they were giving me evidence against their poor performance & incompetence, they abandoned that STUPID high-priest attitude and just swallowed their "pride".
Now, they NEVER comment on anything vis-à-vis their performance and I took control back of my money a long time ago.
Now it's even better to buy 10y bonds and don't care about performance they offer.During the first couple of years, they used to write me back & bother justifying their poor performance and fees, but since then, once they realized they were giving me evidence against their poor performance & incompetence, they abandoned that STUPID high-priest attitude and just swallowed their "pride".
Unfortunately, in Monaco a decent apartment costs 5k per month what makes the entry barrier not so low
I have just read it. It has now become totally clear to me. I wish service providers were as clear when providing information. Giving an example.
That is, if the clients or directors of the company are residents of Gibraltar, corporation tax is payable in Gibraltar.
If the clients and directors are both from outside Gibraltar, the company is exempt from paying taxes on those profits.
Therefore, companies in Gibraltar cannot have a substance exempt from tax. So I'll stick with Guernsey.
*AND* you don't have to give them the full 2 million either. Only 500K! You need 2 million maybe to get accepted, but when you pressure the Monégasque bankers AFTER you get your Carte de Sejour, you can leave them with 500K and invest the difference yourself. Every year, I sent my MC bank their returns vs. my returns on the same 500K amount... I've beaten them for the last almost 3 decades just with the BRK stocks every single year
During the first couple of years, they used to write me back & bother justifying their poor performance and fees, but since then, once they realized they were giving me evidence against their poor performance & incompetence, they abandoned that STUPID high-priest attitude and just swallowed their "pride".
Now, they NEVER comment on anything vis-à-vis their performance and I took control back of my money a long time ago.
This message is super valuable. I appreciate you sharing this information. It is because of these data that I like to keep all 5 senses when someone with a lot of experience speaks. These words are gold.
One question, my bank has partial management of investment funds. I mean, it's not like take the money and do whatever you want.
They presented the investment plans to me after all the risk analysis and so on. But I rejected 4 proposals until we made the current one effective. Well, I did not reject all of the proposed investment funds and their distribution, just some of them that were replaced by others until the portfolio was configured the way I like.
Don't Monaco banks work the same way?
60k a year rent is practically peanuts. With an annual profit of 300k, you are already paying that amount in Estonia.
A business with 300k annual profit is little less than a mini business.
Any consulting firm or marketing company with 10 employees has these benefits per year.
Goddamn! You learn FAST AF!
I wished I was that fast learning and dissecting things!
I am self-taught.
When I opened the company in Estonia, I read all the Estonian government documentation on companies. I summarized the most important parts, added comments about the parts I was most concerned about based on my business plan, and then sent the information to a lawyer in Estonia to check if there were any other laws in Estonia that might be relevant.Since I didn't trust the opinion of just one person, I sent a second lawyer again to get a second opinion. Hahaha.
I always like to do things like that. It's like going to the doctor and asking for a second medical opinion. Many times you avoid problems. If my short life experience has taught me anything, it is that not everyone is a professional.
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In theory, they should. In practice, they are looking for cash cows to drain bonuses and commissions from.
Source:
PS. I have been following the wisdom of the Oracle of Omaha and his sidekick, Charlie, since the early 80s
I developed a system for this type of "discrepancies" in the 80s while doing a double major in Electrical & Computer engineering.
I wrote about this a couple of months ago here: Wyoming LLC to change it to anonymous
You are on the RIGHT path!
In theory, they should. In practice, they are looking for cash cows to drain bonuses and commissions from.
Source:
PS. I have been following the wisdom of the Oracle of Omaha and his sidekick, Charlie, since the early 80s
I developed a system for this type of "discrepancies" in the 80s while doing a double major in Electrical & Computer engineering.
I wrote about this a couple of months ago here: Wyoming LLC to change it to anonymous
You are on the RIGHT path!
Well, I guess it's not a problem. I mean, the more capital you add to the bank, the less self-management you can demand from them.
In the end, since I have to maintain the investment portfolio somewhere, the higher the number, the less problematic they will be.
And the commissions will be better able to be negotiated.
This is somehow of an admirable mindset for me, because I always found comfort in living simply, except for the occasional money splashing.
That doesn't mean living under a bridge, but instead of paying 5K EUR for an apartment in Monaco, I'd rather pay $200 for the same apartment just some hours away.
But I think both mindsets lead to success, they are just different ways of operating.
I blame that college teacher who introduced me to the wonders of compound interest and makes me multiply, in my mind, each expense many times
.In my mind: 250K a year in living expenses is 2.5M after 10 years. Add some compounding from investment returns and it can easily be 4 or 5M lost. If income is 1M a year, that's 4 or 5 years of work lost.
Of course, if the idea is to keep increasing profits, a place like Monaco can help as it can give you the motivation to find ways to increase overall profits. There are also networking opportunities, the ability to surround yourself with successful people, etc.
The Guernsey option sounds really good too, so that was great information. Thank you for taking the time to share your findings with us. Will definitely keep this in mind.
The only problem that I see with Guernsey is that it might be hard to open actual bank accounts for the company, though combining it with a US LLC, like I think you mentione before, could work, in theory.
This is somehow of an admirable mindset for me, because I always found comfort in living simply, except for the occasional money splashing.
That doesn't mean living under a bridge, but instead of paying 5K EUR for an apartment in Monaco, I'd rather pay $200 for the same apartment just some hours away.
But I think both mindsets lead to success, they are just different ways of operating.
I blame that college teacher who introduced me to the wonders of compound interest and makes me multiply, in my mind, each expense many times
In my mind: 250K a year in living expenses is 2.5M after 10 years. Add some compounding from investment returns and it can easily be 4 or 5M lost. If income is 1M a year, that's 4 or 5 years of work lost.
Of course, if the idea is to keep increasing profits, a place like Monaco can help as it can give you the motivation to find ways to increase overall profits. There are also networking opportunities, the ability to surround yourself with successful people, etc.
The Guernsey option sounds really good too, so that was great information. Thank you for taking the time to share your findings with us. Will definitely keep this in mind.
The only problem that I see with Guernsey is that it might be hard to open actual bank accounts for the company, though combining it with a US LLC, like I think you mentione before, could work, in theory.
Hello scooterguy. I think I didn't explain myself well when I said that 60k a year in rent is peanuts.
What I mean is that if I stay in Estonia I pay much more than that amount in taxes. So it's not money I can invest.
Since I want to live in Europe and not in Southeast Asia, the only option I have to have a 0% tax residence is Monaco.
So, since I want to live in Europe, it is better to pay 60k for a rental in Monaco, which in the end is a good that I am enjoying, than to pay that amount to the Estonian tax office, where apart from paying taxes I would also have to pay a rent.
It all depends on each person's personal situation. There are people who have no problems moving to Southeast Asia and reducing their living expenses. But for me, having my family come visit me some weekends, or being able to do so in my country of origin, is worth much more than that 60k a year (from the perspective that my benefits are vastly higher than that amount). If I were making 150k a year in profit, I would probably think differently.
There are people who, when they earn a lot of money, spend that 60k a year on a new car, luxury watches or any other unnecessary material good. I prefer to spend them on being relatively close to my loved ones and being able to see them regularly. That's my luxury.
Monaco is 700 km from my hometown. It is perfect. There are daily direct flights between Nice and my hometown for 60 euros on average with 3 different airlines.
Regarding the Guernsey company, so far it is the best option I have found along with a US LLC (I think it could also be set up with a UK LLP, but I haven't gone into depth). I'm just looking into the bank account opening aspects at the moment, although using private banking there shouldn't be any problems in Guernsey.
Some forum users recommended Gibraltar, but I have practically ruled out that option because I only see disadvantages. It is true that the costs of company formation are cheaper, and so is its maintenance. But it has several major configuration problems in my opinion.
As you have substance, you have to pay corporation tax, being the resident director of Gibraltar. The Gibraltarian company could be used as a subsidiary of a company in another jurisdiction with 0% taxes that acted as parent company and where the substance was located. But the costs of maintaining a US LLC are lower than Gibraltar. And the banks options are higher too in US.
I continue researching to make the best decision.
Yes, I understand that it's money that you are now using to pay Estonian taxes. I believe, however, that you could delay paying those taxes in Estonia by reinvesting the profits instead of taking the dividends.
There are also cheaper places in Europe to live where taxes are low, such as Eastern Europe or Andorra. The latter is right next to your hometown, plus it removes the need for complex corporate setups and makes banking much easier.
But I can see, like I said before, how Monaco can be appealing too.
Sounds good. Keep us updated por favor
Yes, I understand that it's money that you are now using to pay Estonian taxes. I believe, however, that you could delay paying those taxes in Estonia by reinvesting the profits instead of taking the dividends.
There are also cheaper places in Europe to live where taxes are low, such as Eastern Europe or Andorra. The latter is right next to your hometown, plus it removes the need for complex corporate setups and makes banking much easier.
But I can see, like I said before, how Monaco can be appealing too.
Sounds good. Keep us updated por favor
It is true that if I reinvest from the company I postpone paying taxes. But at some point in the future it should, so it doesn't solve anything. In fact, there is a relative risk. That the Estonian government decides to lower taxes is something with zero probability. That it will increase is something that we cannot rule out in the future. If I do not distribute the dividends, and next year the Estonian government decides that instead of 20 it is 30, the bill will be higher. And I really don't trust any government, much less European governments.
Regarding the countries of Eastern Europe and Andorra.
In no Eastern European country would I have paid less than 400k last year, and this year it would probably be around 700k. Less than in Estonia, but much more than the living costs I can have in Monaco.
Also, just like in Estonia, snow, cold, darkness.
Andorra is a similar situation. Same taxes as in Bulgaria. 10% corporate, 5% dividends.
Andorra even worse, cold, snow and feeling of being in a hole that makes me claustrophobic hahaha. Plus it's living in a village, literally. There is absolutely no large city within 200 km. There is no airport. It takes longer to drive from Andorra to my hometown than it does to take a flight from Nice airport.
After almost 3 years in Estonia and having achieved the goals set, I think my time here has come to the end. Damn, I need vitamin D.
I'd like to chime in here...
An older associate went this route +30 years ago. He passed away a while back. He dismissed my warnings because, well, I was a young kid like OP then and what the H*ll did I know, right?
But what I picked up quickly in my physics class on The Principle of Relativity was Eisntein's obscure and sinister quote: "It is easier to denature plutonium than to denature the evil spirit of man" - Albert Einstein
So, my analogy to him was this:
It's like marrying a "less expensive girl" in the meantime, but you are marrying her in a jurisdiction (e.g. Greece) that believes in alimony & child support. The day you want to pick up your things, get divorced, and leave, she, her lawyers/accountants, & the public servants who have an interest in you will NEVER allow you to leave without you paying absurd alimony and maybe even child support...even if the kids aren't yours.
(This happened to him BTW)
Meanwhile, if you marry the "expensive" girl now in a VHCOL jurisdiction (e.g. Monaco) that doesn't levy "alimony and child support" (e.g. taxes), you never have to worry about perpetual expenses
. Just my two cents ... ponder on this.
PS. In an ideal world with everyone working honestly and with integrity, Monaco would NOT be my first choice either, but THAT ship sailed a long time ago!
I'd like to chime in here...
An older associate went this route +30 years ago. He passed away a while back. He dismissed my warnings because, well, I was a young kid like OP then and what the H*ll did I know, right?
But what I picked up quickly in my physics class on The Principle of Relativity was Eisntein's obscure and sinister quote: "It is easier to denature plutonium than to denature the evil spirit of man" - Albert Einstein
So, my analogy to him was this:
It's like marrying a "less expensive girl" in the meantime, but you are marrying her in a jurisdiction (e.g. Greece) that believes in alimony & child support. The day you want to pick up your things, get divorced, and leave, she, her lawyers/accountants, & the public servants who have an interest in you will NEVER allow you to leave without you paying absurd alimony and maybe even child support...even if the kids aren't yours.
(This happened to him BTW)
Meanwhile, if you marry the "expensive" girl now in a VHCOL jurisdiction (e.g. Monaco) that doesn't levy "alimony and child support" (e.g. taxes), you never have to worry about perpetual expenses
Just my two cents ... ponder on this.
PS. In an ideal world with everyone working honestly and with integrity, Monaco would NOT be my first choice either, but THAT ship sailed a long time ago!
Let me take your analogy for.
This is like if you go with the "expensive" girl. A Russian chick accustomed to the luxurious life in Moscow. She is a girl who knows exactly what she wants. She has clear ideas about what she wants in life and before you start fucking her, she tells you that to be happy in life she needs a certain level of maintenance. Yes, at first it may cost you more to f**k the Russian chick than the average girl. But in the long term, she maintains the same standard of living, without caring if you get richer.
Now, you're going for the "cheap" girl, a sweet girl from a small village in Romania. She grew up without luxuries, even her family couldn't afford her orthodontics. Then she meets you, and discovers a new world. She is happy that you are earning more and more money. And she becomes greedier and greedier every day. What used to be a dinner at McDonalds to keep that small village girl happy is now a constant demand for luxury. And the more money you make, the more money she wants to spend.
Real situation that happened to two friends of a relative of mine.
One has been happily married for 20 years with his russian chick (now a milf) in a beautiful place on the coast, with the chick maintaining the same standard of living that her rich russian dad accustomed her to since she was a child. Without being impressed because her husband is getting richer every day.
The one who married the girl from a small romanian village ended up divorced, completely ruined, with large debts in the country and with his children living 5000 km away. According to what my relative says, he boasted to his friend who married the russian chick that his romanian village girl was very cheap to support.
Ok, I now have all the necessary information, and the perfect structure for my situation to use with residence in Monaco. There are some small modifications and specific configurations to make to make everything work perfectly, but now everything is very clear. And it is a very simple process, you just have to have the money to do it (if you meet the residency requirements in Monaco it is only a small cost).
I'll post it on the Mentor Group forum. I am carrying out the monetary procedures to be able to be a Mentor member, so as soon as I can obtain membership, I will share the information there and I will make updates with the process, with the users of the forum in gratitude for all the help that all the users have provided me. who participated in this thread.
Hugely grateful to each one.
I'll post it on the Mentor Group forum. I am carrying out the monetary procedures to be able to be a Mentor member, so as soon as I can obtain membership, I will share the information there and I will make updates with the process, with the users of the forum in gratitude for all the help that all the users have provided me. who participated in this thread.
Hugely grateful to each one.
Just wondering why certain structures wouldn't work under the flat tax of Italy? Is it because of the European 15% law or is it something else? Because you don't got cfc under the flat tax regime, or is the difference that Monaco and others don't care about PE and Italy does?
Because of PE. If you control BVI company from Italy it will definitely become Italian tax resident and you will have lots of problems.
Also, for example, if you trade cryptos as physical person you still have to pay tax in Italy.
This Italian lump-sum regime is only for passive income coming outside of Italy.
Monaco has a limited territorial taxation system. It doesn't have PE defined in its legislation. Instead, you should consider its tax laws which describe when tax is applicable.
Italy, on the other hand, has clearly defined when a foreign corporation is a tax resident.
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