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Offshore Retirement Haven Tax Guide
Introduction – This is a guide to many but
not all of the possible offshore retirement havens and tax havens. This work
is designed to help you eliminate some retirement havens easily and then you
can do more research on the retirement havens that meet your needs. Not all
countries thought to be tax havens are really tax havens as you will see. The
countries are listed in alphabetical order. This is not a guide to
offshore banking
and is not a guide to
offshore
corporations since this directory does not speak seriously to anonymity
issues or bank security and secrecy. Of course seeing the offshore tax rate
does serve to help one eliminate countries for incorporation, banking and
retirement purposes. We do at times add in little bits of information that
would serve to quickly help you eliminate certain countries. Panama is the one
country that does seem to excel in all areas, Uruguay is second. If you are
interested in immigration, residency or passports from any of these countries
contact us and we may be able to refer you to a reputable law firm that can
assist you with the immigration process lawfully and this means a trip to the
country to visit the immigration department with the lawyer accompanying you
of course. Never get involved with any
residency,
citizenship or passport program that does not allow you to be processed at
the immigration department in the country. You should also be able to see the
laws for the program you are applying under. Enjoy the guide.
Argentina
as a Retirement Haven
Embassy for Argentina in Panama - Taxation in Argentina occurs at the
national and municipal levels. Their taxing authority requires bank statements
to be filed with tax returns. Argentinean companies and individuals are taxed
on worldwide profits and income so offshore income is not exempt and this is a
bad thing when looking for a tax or retirement haven. They also have a VAT tax
(the standard rate being 21%) making purchases expensive. The corporation tax
rate is 35% plus there are additional local taxes. Individual tax rates go up
to 35% in stages. Capital gains are included with ordinary income for taxation
purposes. Argentina is in at least 15 tax treaties. Residency is relatively
easy to obtain in Argentina but how in the world do you keep any money after
paying their taxes? This jurisdiction might have some advantages with their
relatively low cost of living if one remained there as a perpetual tourist but
they have rules that make this difficult. A perpetual tourist rents not buys
real estate. Renting requires a deposit equal to one or more years rent to be
given to the landlord as security and you still have to pay rent. At the 11th
month the landlord has your money and you only owe one month rent. It is a
legal nightmare to imagine the tenant leaving and then not getting his deposit
returned. Argentina is a full member of Mercosur which means you can freely
travel through all the Mercosur countries on your residency card without a
passport. It also means you can live in any Mercosur country without need for
a visa. Crime in Argentina is relatively low. The culture is sophisticated.
They country is quite large and there are different weather patterns in the
country depending on where you are. Spanish is the spoken language.
Bahamas
as a Retirement Haven –
This is
a tax haven that does not tax offshore derived income and in fact has no
income tax at all. You can get an instant permanent residency with an
investment of $150,000. The living here is expensive since there is a VAT and
they import almost everything. Real estate is expensive. Crime rate is
acceptable. They do get hurricanes. This one works if you have a lot of money.
Do not use their corporations and note that their bank secrecy is historical
only, bank elsewhere. The Bahamas is in tax treaties and will readily share
information.
Belize
as a Retirement Haven
Belize
Embassy in Panama – This place is a tax haven. No income tax on foreign
source income. No capital gains tax. Residency comes easily if you can show
modest income. Real estate is expensive. Warning – This is a high crime
country, violent crime at that. There is also a lack of infrastructure do not
expect good internet, TV or phones. There are hurricanes and they interrupt
electrical, phones and internet. Medical needs to be obtained out of country.
Belize is in tax treaties and
is not a good choice for bank secrecy. Large secure banks are absent. This
will work for some but not for most.
Bermuda
as a Retirement Haven – This is a tax haven with no income taxes, no
capital gains tax and no inheritance tax. It is a Caribbean island
jurisdiction and has a VAT tax so the cost of living will be high. They do get
hurricanes. The infrastructure will not be like it is in North America but
workable. The
bank and corporate secrecy is long gone so do not bank there. They are in
several tax treaties and will share information, so this is not a privacy
jurisdiction anymore. Corporate fees are very high as well for some strange
reason, not sure who would want one anyway. Residency is not hard to obtain.
This one can work for someone with substantial assets.
Brazil
as a Retirement Haven
Brazil
Embassy in Panama – Unfortunately this nation taxes worldwide income. This
of course is most undesirable for retirees since their income is offshore
derived and not taxed by many more favorable countries to retire in. Brazil
also has state and city taxation. There is also a VAT tax which runs between
18% and 25% which is going to make that TV or refrigerator very expensive.
What you should be looking for is a country like Panama that does not tax
offshore derived income at all which means your retirement checks are not
taxed and there is only a 5% sales tax, no VAT plus capital gains are not
taxed. In Brazil corporate taxes run about 34% with all of them combined.
Personal income tax runs up to about 27% in steps. They have inheritance
taxes. Brazil is in 25 tax treaties. Most of you will be discouraged at this
point and rightly so. On the other side Brazil is a large highly advanced
country. Some parts are full of crime, others not so crime ridden. Cost of
living is going to vary. Portuguese is the spoken language. Brazil is a
Mercosur country so all the Mercosur advantages are in place. You should plan
on dealing with a large bureaucratic government probably not very much unlike
the country you are moving away from. Residency is not that hard to obtain but
of course you can plan on giving them a lot of your money in various taxes.
Real estate prices will be all over the charts due to the various cities and
regions. Unless there are extenuating circumstances most of you will skip
Brazil.
Cayman
Islands as a Retirement Haven – This is a tax haven. They do not tax
income, capital gains or inheritances. There is an import duty and everything
is imported so cost of living is high. Price of real estate is high. Crime
rate is low. Infrastructure is very good. They do get hurricanes and bad ones
at that. Their
banking
secrecy is hysterical so bank elsewhere. The Caymans are in many different
tax treaties and will share information, forget privacy here. Their
corporations and trusts are expensive and have no outstanding feature so look
elsewhere like Panama. If you invest $250,000 in real estate (probably a one
bedroom condo) you can get a residency easily. It is one hour by plane to
Miami. If you have to ask how much the airfare is the Caymans are not for you.
This one works if you have substantial assets. Other than fishing and going to
restaurants and the beach (diving) there is very little to do in the Caymans.
Chile
as a Retirement Haven
Chile Embassy in
Panama – Chilean companies and resident are taxed on their worldwide
income, not just onshore income generated within Chile. This is a bad thing
right off the top. The corporate tax rate is 17% and the personal tax rate is
40% reached in steps. There is a VAT of 19%, ouch. Capital gains are taxed the
same way as income. Chile has inheritance taxes. There are ten tax treaties
Chile is a party in. Real estate prices are relatively high in Chile. Chile is
an associate member of Mercosur so some of the advantages apply. Spanish is
the spoken language. Chile is the opposite of a tax haven so most of you will
not select this as a retirement haven.
Columbia
as a Retirement Haven
Columbia Embassy in Panama – This is an interesting country to look at.
Most of you will avoid this country since it is in almost perpetual political
turmoil with revolutionaries controlling parts of the country. It seems their
major export is cocaine from reading the newspapers. Columbian people have a
seriously difficult traveling with their passports, think full body cavity
searches and numerous questions. Many of them use the
Panama Instant
Passport program so they can travel without all this hassle. If you are
fluent in Spanish and understand life in Columbia you may find it a nice place
to live. The other 99.9% of you should avoid this country as being too
dangerous. The people in general are nice, the lifestyle is great and low
priced but the ever looming threat of kidnapping and major violence is far too
great. But for those of you who are still interested taxes are a problem here.
There are national and regional taxes. Taxes are applied to worldwide income
not just income derived in Columbia. The corporate tax rate is 35% and the
personal income tax rate is 35% in steps. The VAT rate is 16%. Columbia is in
a limited tax treaty with neighboring countries (Peru, Ecuador, Venezuela, and
Bolivia). Capital gains are taxed as ordinary income. Columbia is far from a
tax haven, keep looking you can do better.
Costa
Rica as a Retirement Haven
Costa Rica
Embassy in Panama – This is an interesting place. In recent years Costa
Rica was touted heavily in the internet as a retirement haven. Those doing the
touting would invest in lots, develop them and sell them to the retirees who
thought it was a haven. Wrong. The retirees soon found out the country was not
so great. Their neighbors would say hello to them every morning and then when
they went to the states the neighbors would pick axe through the cement walls
openly and rob the entire contents of the house and then continue to say hello
to them when they returned even watching their TV set. The locals will not
like you and they think every North American, Brit and Aussie has unlimited
wealth and it is probably acceptable to steal from them as long as you don’t
get caught. We hear of car jackings, and other violent crime. If you live here
you should only live in a guarded gated community. The banks are not modern,
neither is the roads, phones, water etc. the internet is good. Costa Rica does
not currently tax offshore derived income but they very recently have tried to
pass such a law. In the past Costa Rica had a pensionado law allowing certain
benefits for retirees. After a bunch of retirees moved there they revoked the
law. This tells you how they think and no this is not common in Latin American
countries to revoke laws like that. It breeds a lack of trust in the
government and is not something we see at all, Costa Rica is the exception.
Their corporate tax rate is 30%; income tax for income derived within Costa
Rica is in stages up to 25%. People and corporations are required to make
monthly advance payments of tax. The standard sales tax is 13%. They have one
tax treaty and that is with Spain. They are not to be trusted with banking for
reliability and secrecy. Residency is not hard to obtain. Real estate has
risen to extremely expensive levels.
Dominican
Republic as a Retirement Haven – This is a useful retirement haven.
They do not tax offshore derived income here. No capital gains tax here and no
inheritance tax. The banks are deficient and the bank secrecy is not good and
there are tax treaties but heck who says you have to bank here. Their currency
is the eastern Caribbean dollar. The crime is not so low but manageable.
Housing is not expensive by North American standards. For medical care go
outside the country. There is not a modern infrastructure so the internet, TV,
cell phones, and land line phones will not be what you are used to. There is
an easy citizenship program where for a fee of $100,000 plus legal fees can
become a citizen with passport relatively fast. It does require a trip to the
country, an existing passport, police clearance etc. Spanish is the language
spoken. Not for everyone but will work for some.
Ecuador
as a Retirement Haven
Ecuador Embassy
in Panama – This is starting to attract interest as a retirement haven.
One can get a 10,000 sq. foot home for $100,000 in a nice area. The home of
course should be in a guarded gated community and you should figure in some
extra money each month for your bodyguards unless you do not mind an
occasional car jacking or kidnapping. Ecuador has some time to go before it
becomes a viable retirement haven. Things like good medical, phones, TV,
internet, roads, water etc are not going to make you feel warm and mushy
inside. The food is good though. Ecuador is not a tax haven at all. Worldwide
income is taxed. Ecuador is in ten tax treaties. Corporate income tax is 25%
and personal income tax is 25% reached in stages. There is a 12% VAT. For most
of you this is not a viable option. If you have several black belts, are
excellent with firearms, enjoy keeping a pack of pit bulls nearby at all times
and do not mind wearing bullet resistant clothing in a tropical climate you
may thrive in this country, our opinion only. Oh did I mention the AIDS rate
is pretty high. Check back in five or ten years and I’ll bet things
drastically improve here for retirees but they will need to provide special
concession for offshore derived income that are now absent. They seem to be
trying, let’s give them a chance.
Guatemala
as a Retirement Haven
Guatemala
Embassy in Panama – Now this one has merit. Guatemala actually is a tax
haven and even a privacy country, really it is. See we are only negative when
indicated <smile>. Individuals and corporations are only taxed on onshore
income; income from outside of Guatemala is not taxed. Okay this is what you
should be looking for first thing. There is a 12% VAT which isn’t that bad
considering. Guatemala seems to be in no tax treaties, again another plus.
They have no anti-tax haven legislation. Guatemala has a high aids rate. There
is a 75% poverty rate. The cost of living will be ridiculously low for a North
American or Western EU resident. Residency is relatively easy to obtain. This
country has a substantial violent crime rate – caution needs to be exercised.
This is not a country for all. One should be fluent in Spanish and really
understand life in Latin America before trying to live here. If you know the
language and the customs you could probably have a nice life here. It will not
be as civilized as other countries but you could plan on the government not be
a pain in the neck which is the case in many of the countries you are planning
on leaving.
Honduras
as a Retirement Haven
Honduras
Embassy in Panama – This is probably not a wise choice on many counts.
Honduras does tax offshore and onshore income so this should basically be a
knock out question and Honduras fails. The corporate tax rate is 30% and the
personal tax rate goes up to 25% in stages. The sales tax rate is 12%.
Honduras seems to have no tax treaties. The crime rate is high, it led the
world in Homicide rates a few years ago which speaks for itself as a big stay
away. The kidnapping is a real problem. AIDS is bad. Narcotics trafficking is
present. On the other hand real estate prices are low, as is household labor.
The food is good. This is a country only for one with special reasons for
being there that is fluent in the language, the culture and knows the land.
Ireland
as a Retirement Haven – This is no tax haven and although some people
seem to think it is. Worldwide income is taxed, not just onshore income. The
corporate tax rates are 12.5% to 25% and the individual income tax rate goes
up to 42%. The standard VAT rate is 21%, ouch. If you imagine life under this
level of taxation, you should decide against Ireland. Too many high taxes.
Jamaica
as a Retirement Haven
Jamaica Embassy in Panama – This is not a tax haven. Jamaica taxes onshore
and offshore income. The corporate tax rate is 33.3% and the personal income
tax rate is 25% reached in stages. Jamaica has a sales tax called a General
Consumption Tax of between 12.5% and 20%, ouch. Real estate prices are very
high. Labor is much higher than you might think. There is an amazing amount of
narcotics use and trafficking in Jamaica. They have a fair amount of crime.
Government regulation will remind you of a large bureaucratic country not
unlike the one you are planning to leave. They get hurricanes, sometimes
taking bad hits. Jamaica has a lot of kidnapping for sexual exploitation; it
is mostly the arrival point for those kidnapped from other countries like
Eastern Europe and the Dominican. Jamaica has a sexual tourism trade even
involving children. They are suspected of participating in exploitation for
domestic servitude and labor. So if you are a drug user who is a sexually
deranged and does not mind paying high taxes you may find Jamaica a beautiful
place to live, for the rest of you stay clear. The last time I was there which
was recently I was approached by narcotics sellers three times in the first
thirty minutes in country. Shame on them, they can try harder to clean it up
if they wanted to. The source for this negative data is as follows:
https://www.cia.gov/cia/publications/factbook/geos/jm.html
Mexico
as a Retirement Haven
Mexico Embassy
in Panama – Now this place is hard to figure out. In Panama we meet people
who are leaving Mexico and meet others who are not leaving. In recent months
parts of Mexico have become most dangerous and from what we are told by people
living there other parts are not so unsafe. We would say avoid Mexico until it
settles down. In any event Mexico is far from a tax haven. Mexico taxes both
onshore and offshore income for corporations and individuals. The tax rate for
corporations and individuals is the same 33% with progressive rates for
individuals. The VAT is 15%. Mexico is in 25 tax treaties. Mexico fails the
tax test for being a retirement haven. Mexico would only be suggested for
those with a fluency in Spanish and a deep understanding of the culture and
even then there are better places to retire. Many of the retirees in Mexico
stay there as undocumented people or perpetual tourists and thus avoid the
taxation issues. This is not suggested, just an observation of what is being
done.
Panama
as a Retirement Haven– This is
the
number one retirement haven in the world. It is a true tax haven with no
tax on offshore derived income, no capital gains tax and no inheritance tax.
It has great food, great medical, and is very safe. You can drink the water in
Panama City, the roads are American Style, you can take an American telephone
and plug it into the socket and get a dial tone and American appliances work.
The internet is great. The phones are good and the cell phones are like North
America, some dead spots. There are Pensionado visas for retirees with great
benefits. Residency is not hard. There is an instant passport program. There
are no hurricanes in Panama, no volcanoes, no earthquakes, and no tsunamis. It
is tropical warm year round. You can get by with English to a workable extent.
There are anonymous corporations, anonymous foundations and 150 large
international banks. Panama even has its own stock exchange. Real estate is
affordable and hired help is cheap by North American standards. For more
information on Panama go here:
http://www.panamalaw.org/panama_lifestyle.html
Peru
as a Retirement Haven
Peru Embassy in
Panama – This is not a tax haven. Worldwide income is taxed, not just
onshore income. The corporate tax rate is 30% and the personal tax rate is 15%
to 30%. Peru is in five tax treaties. Source for more information is as
follows:
https://www.cia.gov/cia/publications/factbook/geos/pe.html
Saint
Kitts and Nevis as a Retirement Haven – These are Caribbean Islands
near Anguila, and Antigua. The official currency is the Eastern Caribbean
Dollar. The official language is English. This is a tax haven with no taxation
on offshore derived income, and no capital gains tax. There is
reasonable corporate privacy and bank secrecy. There are no serious secure
large banks we know of. They do have some tax treaties. One can easily become
a citizen here using their economic citizenship program. You will need to
invest $250,000 in a government approved real estate program plus perhaps
another $50,000 in fees, not cheap. Saint Kitts and Nevis has a good passport.
The crime rate is acceptable. It is an island subject to hurricanes. Will work
for some who can afford it. Everything is imported and hit with a VAT tax so
cost of living will be high and there is not too much to do other than fish
and enjoy the beach and that is not so bad.
Spain
as a Retirement Haven
Spain Embassy in
Panama – Not a tax haven. Offshore an onshore income is taxed. The
corporate tax rate is 35%. The individual tax rate is from 15% to 45%. The VAT
rate is 16%. Capital gains is taxed as income. Spain is in 49 tax treaties.
Sorry Spain fails miserably on the tax test. This country might have some
special attraction if one only speaks Spanish and wishes to live in the EU.
There are various ways to get residency without too much difficulty.
Turks
and Caicos as a Retirement Havens – this is a tax haven. There is no
income tax at all. No capital gains tax. There is a VAT tax and everything
needs to be imported into this island jurisdiction so the cost of living will
be high.
There is a shortage of secure banks and there are tax treaties so bank
elsewhere. One can become a permanent resident by investing $250,000 in a
government approved investment. They have hurricanes. This Caribbean island
jurisdiction can work for some of you who have substantial assets.
Uruguay
as a Retirement Haven
Uruguay Embassy
in Panama – This one is a sleeper. It is all good except for one thing,
the weather. It is not warm year round. There are three cold months, the North
American summer is there winter plus two months where it is not so cold but
not warm either. In their winter there is no freezing and no snow but you
would need a warm sweater and an insulated house with heat of some sort. Many
of the homes are sold as summer vacation cottages and have no heat or
insulation. Many Argentineans vacation here. They can take a hydrofoil ferry
boat from Buenos Aires to Montevideo in under three hours. Uruguay does not
tax offshore income, they in fact have no personal income tax – NONE. They
have a 23% VAT tax however. They have
corporate and bank secrecy. They have bearer share corporation that seem
to require a tax on the assets which is very small but requires filing a tax
return listing corporate assets and this is public information. This sort of
ruins their corporations for privacy. Their currency is their Peso so expect
currency conversion expenses. The real estate is most affordable. The people
are friendly. Residency and citizenship is relatively easy. They are a
Mercosur country so with a residency one can travel to any other Mercosur
country without a passport or visa and you can remain there without a visa
too. Food is good. Culture is advanced; Spanish is the mother tongue of the
country. It takes about 12 hours to fly to New York from Montevideo for those
of you who like to go back and forth to North America. Health care is
excellent and affordable. Crime rate is extremely low. Folks the negatives are
sorely lacking here. One must consider the distance and the weather. The
culture and people in Uruguay will be much more like Europe than Latin
America. We can help you with this one.
Venezuela
as a Retirement Haven
Venesuela Embassy in Panama – This is not a tax haven nor is it good for
retirement. The current regime is not very respective on individual property
rights and is supportive of squatter’s rights to land and homes. Venezuela
taxes onshore and offshore income. The corporate tax rate is the same as the
individual tax rate which is progressively up to 34%. The VAT is 15%.
Venezuela is in more than 20 tax treaties but it is doubtful as to how much
they provide to some countries. Capital gains is taxed as income. The country
is oil rich but in dangerous water politically. It is a full Mercosur country
with all the benefits of such membership. It is suggested you look for a
different type of tax and political environment to retire in.
More Countries – Check back from time to time in that we
are constantly updating this section adding more countries and more
information about the countries.
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