If you’re a high-net-worth individual looking to reduce your taxes and enjoy more financial freedom, there are several countries that offer tax advantages for expats. In this article, we’ll explore the top three countries that the wealthiest people are moving to in order to pay less taxes.
1. Dubai and the UAE: Straightforward Zero Percent Tax
An Attractive Destination for High Net Worth Individuals
Dubai and the UAE have become a popular destination for wealthy expats because of their straightforward zero percent tax. The country has a five percent VAT for goods sold within the UAE, but this typically doesn’t apply to most people. Crypto investors, online entrepreneurs, and capital gains investors can all enjoy zero percent tax on passive income.
Easy Company Incorporation Process
Incorporating a company in Dubai is relatively simple and can be completed within a month, costing around $10,000 to $25,000, depending on the chosen free zone. The UAE’s tax system is not as complex as those in countries like Australia or the United States, making it an attractive option for those looking for a simpler tax environment.
H2: Minimal Residency Requirements
To maintain a three-year residence permit, expats only need to visit the UAE for 24 hours every six months. However, it’s advisable to spend more time in Dubai to avoid suspicion during audits from tax residence countries.
2. Portugal: Potential for Zero Percent Tax with Investment
Golden Visa and Non-Habitual Resident Status
Portugal is another attractive destination for wealthy expats, with the potential for zero percent tax if an investment is made or if the individual is willing to spend time on the ground. The Golden Visa program allows for non-habitual resident status, which means that taxes are significantly reduced for the next ten years.
Flexible Residency and Travel Options
By obtaining a Golden Visa, expats can live anywhere in the European Union or Schengen area and maintain residency by spending only seven to 14 days per year in Portugal. After five years, individuals can apply for Portuguese citizenship, giving them further travel and residency options.
Attractive for Crypto Investors
Portugal does not tax crypto-related income, making it an ideal destination for those with income from crypto investments.
3. Cayman Islands: A Caribbean Tax Haven for the Ultra-Wealthy
Permanent Residence with a Significant Investment
The Cayman Islands offer permanent residence to individuals who invest at least $2.4 million in real estate. This option is especially appealing to those with a net worth of $20 million or more, as it allows them to establish a base in a tropical, tax-friendly environment.
Minimal Residency Requirements and Potential for UK Citizenship
To maintain permanent residence, expats need to spend just one day per year in the Cayman Islands. After five years, they can apply for British Overseas Territories citizenship, and after 12 months, they can obtain a UK passport.
A Convenient Location for North American Expats
The Cayman Islands’ proximity to the US and Canada make it an attractive option for those who want to maintain easy access to North America.
For wealthy expats seeking tax advantages, Dubai and the UAE, Portugal, and the Cayman Islands are top choices. Each destination offers unique benefits, so individuals should carefully consider their personal and financial goals when deciding on the best fit.