OECD issues consultation documentation regarding the investment schemes involving misuse of residence for circumventing the Common Reporting Standard

A growing number of jurisdictions are offering Citizenship by investment (CBI) or Residence by investment (RBI) schemes allowing foreign citizens to obtain local citizenship or permanent or temporary residence rights in order to take advantage of the local flat fees or in exchange for local investments. These individuals may be interested in these opportunities for a number of legitimate reasons such as taking advantage of visa free travelling, increased mobility or better job or educational opportunities, or the choice of living in an economically stable country. But at the same time the information which is released on the market and obtained by the OECD CRS public disclosure facility stresses on the various RBI and CBI misuse schemes which are aimed at circumventing the requirements for reporting under the Common Reporting Standards (CRS).

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OECD has released its latest developments regarding the BEPS implementation

OECD has announced further actions to be taken for efficient Base erosion and profit shifting (BEPS) implementation for the collaboration among the country members of the Organization and their jurisdictions of potential tax avoidance schemes which use the existing mismatches and gaps in the tax rules for shifting profits toward locations with lower or no taxes. The latest developments are targeted towards assuring certainty for both Multinational Corporations and tax administrations and require Country-by-Country (CBC) reporting.

The Inclusive Framework includes the newly approved updates to the results of the preferential regime reviews of the Forum on Harmful Tax Practices (FHTP) regarding BEPS Action 5.

CFC: The devil in the details for location independent business people

Plane ticket (check), Offshore company (check), Offshore bank account, Payment processing (check),

NO TAXES …!!! ….. SLOW DOWN …. CFC will put a damper on your tax free dreams if you neglect to follow some basic guidelines listed below.

We will cover some information to protect yourself from liberty bashing politicians and regulatory authorities while you travel and enjoy the benefits of a location independent lifestyle.

 

While there are many jurisdictions where you can establish a company, other factors come into play aside from ‘x’ % – tax rate in ‘y’ country

CFC rules prevent many people from legally doing business through another company in another country while they are sitting in their home country or country of residency. Unfortunately these ruin grand plans people have about sipping fruity cocktails and working from their laptop on the beach.

However, there are some countries that do not have laws constraining your earning ability in a foreign country while you are in your current country.

Our goal is to help you better understand how to avoid the shakedown by the taxman in your country of citizenship and country of residence as you travel and work worldwide.