4 ms·

As an American expat my experience far more people are moving to the US for tax reasons than are moving away. Out of all the western democracies it’s still one

by yardie 9y ago

As an American expat my experience far more people are moving to the US for tax reasons than are moving away. Out of all the western democracies it’s still one of the lowest taxable rates. Most people surrendering citizenship aren’t doing so to avoid taxes. They are doing so to avoid double taxation. A Bitcoin billionaire is either paying the US 15-20% capital gains tax or France, for example, 45-50%. Either way, Caesar still gets his due.

origami777 9y ago
Singapore is a western (like) country and has no capital gains tax. Though as some other commenters have noted, i don’t know if the IRS would consider it legal for a US citizen to bail and not pay the tax. Edited
- dogma1138 9y ago
  Singapore is a tiny bubble that if you are rich you can live a luxurious life style without fearing (too much) for your safety but I would not call it western by any means.
  - origami777 9y ago
    Hmmmm. Your statement makes me think you don’t know much about Singapore. It is a tiny city, but it has a massive role in Southeast Asia. I have lived there before and lived a great life without being rich by US or Singapore standards. The national language is English. They are by all means a capitalist country. It is a modern high tech society. Very western if you ask me. The only way they aren’t that I can think of is that they are not a democracy.
- sjg007 9y ago
  You can't renounce citizenship for purely tax reasons, I believe.
  - origami777 9y ago
    The closet incident I could remember was when a Facebook co founder did this. Looks like he still had to pay a tax https://en.m.wikipedia.org/wiki/Eduardo_Saverin https://en.m.wikipedia.org/wiki/Eduardo_Saverin
saosebastiao 9y ago
I heard there's a law preventing you from getting a visa to the US if you surrender your US citizenship for tax reasons. Does that still apply if you became a citizen and resident of a higher taxing nation, but didn't want to be double taxed?
- tptacek 9y ago
  Technically, there is. It requires the Attorney General to issue a determination about your specific case. It's never been used (it's 20 years old); it could theoretically be applied, but it's unlikely to be.
charlesdm 9y ago
Following countries allow you to cash out Bitcoin tax free, if you're an early holder: the UK, Ireland, Cyprus, Malta, Belgium, Netherlands, possibly Germany, Switzerland, Singapore, the UAE, Monaco, the Channel Islands, Andorra, Italy (if you pay a €100k levy), Portugal, Singapore, and I probably forgot another dozen countries. Pretty much half of Western Europe. If you have the money, most of these countries offer great quality of life. If you're sitting on a $100m gain.. it's worth it. A change of scenery isn't always bad in life. Personally I would never voluntarily pay 20% on a massive gain if there is a legal way to avoid it. I guess what this article is implying is, since the US treasury does not know of the existence of these Bitcoins, people can easily renounce (committing US tax fraud in the process) and cash in.
- josephagoss 9y ago
  Do you have a source on the UK having a lower tax rate for early Bitcoin holders?
  - charlesdm 9y ago
    Only for non doms. Gains will be exempt from CGT if held in a bank account outside of the UK, unless remitted to the UK. See answer above.
- cm2187 9y ago
  Why the UK? I would expect the transaction to be liable to capital gain taxes. I think only betting or spreadbetting are tax free.
  - charlesdm 9y ago
    You need to be a non-dom to be make use of the remittance system and not be liable to tax upon the sale of your asset (in this case Bitcoin or other crypto). Most former British colonies have a similar system (in particular, Ireland, Malta and Cyprus) and (if you have a British passport) could make use of the system there, as you do not have your domicile in those countries. See http://www.telegraph.co.uk/finance/personalfinance/expat-money/7465517/Non-dom-status-do-you-qualify.html http://www.telegraph.co.uk/finance/personalfinance/expat-mon...

by yardie 9y ago

origami777 9y ago

Singapore is a western (like) country and has no capital gains tax. Though as some other commenters have noted, i don’t know if the IRS would consider it legal for a US citizen to bail and not pay the tax. Edited

dogma1138 9y ago
Singapore is a tiny bubble that if you are rich you can live a luxurious life style without fearing (too much) for your safety but I would not call it western by any means.
- origami777 9y ago
  Hmmmm. Your statement makes me think you don’t know much about Singapore. It is a tiny city, but it has a massive role in Southeast Asia. I have lived there before and lived a great life without being rich by US or Singapore standards. The national language is English. They are by all means a capitalist country. It is a modern high tech society. Very western if you ask me. The only way they aren’t that I can think of is that they are not a democracy.
sjg007 9y ago
You can't renounce citizenship for purely tax reasons, I believe.
- origami777 9y ago
  The closet incident I could remember was when a Facebook co founder did this. Looks like he still had to pay a tax https://en.m.wikipedia.org/wiki/Eduardo_Saverin https://en.m.wikipedia.org/wiki/Eduardo_Saverin

saosebastiao 9y ago

I heard there's a law preventing you from getting a visa to the US if you surrender your US citizenship for tax reasons. Does that still apply if you became a citizen and resident of a higher taxing nation, but didn't want to be double taxed?

tptacek 9y ago
Technically, there is. It requires the Attorney General to issue a determination about your specific case. It's never been used (it's 20 years old); it could theoretically be applied, but it's unlikely to be.

charlesdm 9y ago

Following countries allow you to cash out Bitcoin tax free, if you're an early holder: the UK, Ireland, Cyprus, Malta, Belgium, Netherlands, possibly Germany, Switzerland, Singapore, the UAE, Monaco, the Channel Islands, Andorra, Italy (if you pay a €100k levy), Portugal, Singapore, and I probably forgot another dozen countries. Pretty much half of Western Europe. If you have the money, most of these countries offer great quality of life. If you're sitting on a $100m gain.. it's worth it. A change of scenery isn't always bad in life. Personally I would never voluntarily pay 20% on a massive gain if there is a legal way to avoid it. I guess what this article is implying is, since the US treasury does not know of the existence of these Bitcoins, people can easily renounce (committing US tax fraud in the process) and cash in.

josephagoss 9y ago
Do you have a source on the UK having a lower tax rate for early Bitcoin holders?
- charlesdm 9y ago
  Only for non doms. Gains will be exempt from CGT if held in a bank account outside of the UK, unless remitted to the UK. See answer above.
cm2187 9y ago
Why the UK? I would expect the transaction to be liable to capital gain taxes. I think only betting or spreadbetting are tax free.
- charlesdm 9y ago
  You need to be a non-dom to be make use of the remittance system and not be liable to tax upon the sale of your asset (in this case Bitcoin or other crypto). Most former British colonies have a similar system (in particular, Ireland, Malta and Cyprus) and (if you have a British passport) could make use of the system there, as you do not have your domicile in those countries. See http://www.telegraph.co.uk/finance/personalfinance/expat-money/7465517/Non-dom-status-do-you-qualify.html http://www.telegraph.co.uk/finance/personalfinance/expat-mon...