This list of Tax Havens was based on the OECD list of tax havens 2004 and then adapted to help to gain helpful information for the assistance of anyone hoping to become a tax exile!
Albania
I have been assured that the tax rate is around 7% to 10% in this South East European country, and that tax solutions are possible because of the banking arrangements.
Andorra *
Mountainous country in the Pyrenees between France and Catalonia. Well known for being an independent tax haven nation.
Anguilla *
Antigua and Barbuda *
Aruba *
Bahamas *
"Red Carpet Not Red Tape" - There are no taxes levied on capital gains, corporate earnings, personal income, sales, inheritance, or dividends. However there is a 1-2% tax/year on property ownership, and a few import taxes.
Bahrain *
Barbados *
Possibly a low tax country, some sources claiming tax rates to be about 2% or thereabouts. Other info, from several sources, is that Barbados is no longer a tax haven, and that the tax is more like the UK (40%).
Belize *
Current information to hand suggests there is a 6% tax on companies operating within the Belize market, but not international businesses which are encouraged to move there (IBC). Business expenses aren't considered. Also there is some purchase tax, and some import duty, on some items. I was so impressed with the place that I bought a web domain there! See www.zyra.bz!
Bermuda
Any company in Bermuda has to be 60% owned by Bermudians. We're still not sure if it's possible to become a Bermudian by being granted citizenship or whether you have to be born a Bermudian.
British Virgin Islands *
About 60 islands in the Caribbean, all small. Cost of living is high. Nice place, but I'd question whether this is a tax haven. At 20% tax, it's almost half that of the UK! However, there are some cunning tax solutions which you should consult a tax adviser about.
Canada
I wouldn't have considered Canada as a tax haven, and I would guess that Canadians would agree with me on that! However, I have been informed "Canada lets you set up a 5 year immigrant trust which is tax free. This basically means that you can move to Canada and, provided you have money, investments or a business already in place, you can set up an immigrant trust and be tax free for 5 years (on all money other than earned in Canada). Because it takes 3 years to become a citizen you can actually get 5 years tax free and change nationality and leave before you get taxed. Once you leave - you remain Canadian but you are not taxable in Canada. Canadians get special treatment on living / working in USA." ... Interesting? See a tax adviser!
Canary Islands
The Canary Islands is not a tax haven currently (2005) as it's part of Spain. However, after Canary Islands independence, it might be different.
Cayman Islands
In the Caribbean, just South of Cuba. No income tax, no inheritance tax. Zero percent tax. Some VAT and hotel tax etc. Property price cheaper than in London but more expensive than Up North. Entry requirements: selective. There is a problem however, which is that the place is notoriously not diversity-friendly!
Cook Islands *
You can't own land there, and it's quite difficult to be accepted as a citizen (2006), but there are many good things about the Cook Islands, if your desired life style fits. The place to find out more is: www.cookislands.org.uk
Costa Rica
Income tax is only charged on income made actually in Costa Rica, with international income being exempt. For migration to Costa Rica a helpful contact is ARCR.NET. Also see Costa Rica Real Estate
Cyprus
An island in the Mediterranean. Half of it is Greek, and the other half Turkish. The regimes don't get along well with each other, but most of the people just get on with life and don't worry about the politics.
Dominica *
Commonwealth of Dominica. As distinct from the Dominican Republic. There is no capital gains tax in Dominica.
Dominican Republic
The people at the Embassy in London are very friendly and welcoming. There's a lot of paperwork to read through, so I'll tell you more later on this. However there is some conflicting evidence suggesting that the Dominican Republic is not a tax haven. Someone said the tax rate was 35%. Is that true?
Gibraltar *
The Rock of Gibraltar, one of the Pillars of Hercules, a the gateway to the Mediterranean. Tax advice given by travel agents suggests this is good, but we're going to ask accountants to make sure.
Grenada *
Guernsey *
Channel Islands Guernsey / Sark / Alderney. The tax rate in Guernsey is 20%, which is quite high, but not as bad as the mainland UK.
Ireland
Depending on your line of business, Ireland could be a tax haven. Money made by being an artist is somehow tax exempt! Also a comment received here is "Ireland is pretty low tax provided you funnel everything through a corporation. I think they are down to 12% tax or lower now. (2006) Like England, Ireland is a tax haven if you are not Irish, live there but have domicile elsewhere". But remember: It's not tropical!
Isle of Man *
In the Irish sea between mainland Britain and Ireland, so not exactly tropical! However many tax haven companies are established there, although they don't all live there.
Jersey *
One of the Channel Islands, gaining splendid publicity by the television series Bergerac. To buy a house in Jersey requires you to have either: 1. been born there, or 2. lived there for 5 years, or 3. Have five million pounds in the bank.
Liberia *
African country, well-known for being a Flag of Convenience.
Liechtenstein *
The Principality of Liechtenstein - A small country in the middle of Europe. I've heard it's expensive to live there, but I'm sure someone will write to me and tell me more about it.
Luxembourg
Maldives *
The Republic of Maldives. Many coral atolls in the Indian Ocean.
Malta
Islands in the Mediterranean. Does this count as as tax haven? The tax rate is 15%, but there are special discounts for electronic manufacturing companies because they're the latest fashionable thing! That doesn't include Internet companies, so I have heard, which seems a bit odd.
Marshall Islands *
The Republic of Marshall Islands
Mauritius
Indian Ocean Island off East Africa - "The Cyber Island" - Permanent residents who invest at least $500,000 welcome.
Monaco *
Montserrat *
Nauru *
Netherland Antilles *
The Dutch Antilles
Niue *
Panama *
The land between North and South America. Famous for being a Flag of Convenience, and for having a canal by which ships can avoid a round-trip round Cape Horn.
Samoa *
Or Western Samoa.
San Marino
Although an independent country, San Marino is entirely surrounded by Northern Italy. Although suggested at some time as a tax haven, I have been reliably informed: "Remove San Marino - at 50% personal income tax, who would bother moving there?"
Seychelles *
The Republic of Seychelles
St Lucia *
St Kitts and Nevis *
Or "The Principality of St. Christopher and Nevis"
St Vincent and the Grenadines *
Or "The Republic of St. Vincent"
Switzerland
I have heard that in Switzerland you can have a business arrangement with the authorities to pay a flat rate and then earn as much as you like. The Double Tax treaty means that you are free to move the money to wherever you want after 12 months. It would be interesting to know what the level of the flat rate might be.
Tonga *
Or The Friendly Islands. About 150 islands in the South Pacific.
Turks and Caicos *
Many islands south of the Bahamas. Turks and Caicos is a British dependency.
UK
I have been told that there is a perspective in which the mainland UK is a tax haven, provided you are not British. Exactly how this works, I do not know. I for one, am trying to escape from the UK!
US Virgin Islands *
Includes St Croix (famous for golf), St Thomas, and St John.
Vanuatu *
The Republic of Vanuatu. As far as I know, tax rate is 5%. Nice tropical location in the Pacific, but there is a law against foreigners owning land, but I'm not sure if it's possible to cease to be a foreigner by living there a while.
Also see the BBCs comments about Vanuatu
* = was on the 2004 OECD list of tax havens regarded for some reason or other as un-cooperative. We don't necessarily agree with the OECD and have asked them politely and diplomatically what they regard as the "harmful tax practices" which they are hoping to eliminate. They haven't replied yet.
As Dubai is a ‘no tax’ emirate its double taxation treaties are actually designed to make it an even more attractive destination and prospect for those individuals and companies who originate from countries with aggressive taxation policies.
The treaties are in place to further reduce any potential taxation burdens being levied against foreign companies and citizens operating in the UAE and Dubai who remit their profits abroad.
Double taxation agreements exist between the UAE and Algeria, China, Egypt, Finland, France, Germany, India, Indonesia, Italy, Jordan, Kuwait, Malaysia, Malta, Pakistan, Poland, Romania, Singapore, South Korea, Sudan, Syria, Turkey and Yemen.
The use of differing tax laws between two or more countries to try and mitigate tax liability is probably as old as taxation itself. It is sometimes suggested that the practice first reached prominence relating to the use (or avoidance of) the staple ports in the fourteenth century. Others suggest that the Hanseatic League first embraced the concept of tax competition as early as 1241, while others argue that the tax status of the Vatican City was the earliest example of a tax haven (the first Papal States being recognised in 756).
Various countries claim to be the oldest tax haven in the world; the Channel Islands claim tax independence dating from the Norman Conquest, and the Isle of Man can trace its fiscal independence to even earlier times. Nonetheless, the modern concept of a tax haven is generally accepted to have emerged at an uncertain point in the immediate aftermath of World War I.[2] Bermuda sometimes optimistically claims to have been the first tax haven based upon the creation of the first offshore companies legislation in 1935 by the newly created law firm of Conyers Dill & Pearman.[3] However, the Bermudan claim is debatable when compared against the enactment of a Trust Law by Liechtenstein in 1926 to attract offshore capital.[4]
Most commentators suggest that the first true tax haven was Switzerland, followed closely by Liechtenstein.[5] During the early part of the twentieth century, Swiss banks had long been a capital haven for people fleeing social upheaval in Russia, Germany, South America and elsewhere. However, in the years immediately following World War I, many European governments raised taxes sharply to help pay for reconstruction. Switzerland, having remained neutral, avoided these costs and was able to keep taxes low, leading to an inflow of capital for purely tax related reasons. Nonetheless, it is difficult to point to a single event or date which constituted the emergence of the modern tax haven.
Failures
Quote:
Although tax havens are traditionally linked with images of prosperity,[9] there have also been notable failures.
* Beirut formerly enjoyed a reputation as the only tax haven in the Middle East. However, its reputation took a severe dent after the Intra Bank crash of 1966,[10] and the subsequent political and military deterioration of Lebanon destroyed any notion of the necessary stability for a successful tax haven.
* Liberia enjoyed a prosperous ship registration industry. The fact that the ship registration business still continues is partly a testament to its early success, and partly a testament to moving the national Shipping Registry to New York City, but the series of violent and bloody civil wars in the 1990s and early 2000s severely damaged confidence in the jurisdiction.
* Monaco is still regarded as a tax haven, but it only has a shadow of the former success which it enjoyed up until 1963, when it surrendered to French demands to align its tax system with France in relation to French companies and French individuals.
* Tangier enjoyed a brief but colourful existence as a tax haven in the period between the end of effective control by the Spanish in 1945 until it was formally reunited with Morocco in 1956.
* A number of Pacific based tax havens have literally closed up shop (although not formally) in response to OECD demands for better regulation and transparency in the late 1990s.
It comes down to "domicile" status (or something very close to that it is called, I cannot remember exactly - I will get the exact details later), whereby, provided the person/company is based outside the UK for 6 months (that region, would not swear on the exact figure [pretty certain, though]- again, will try and find sources to remind myself the exact details), then tax is pratically non-existant (provided you properly exploit the opportunities this status offers). This way the mega-rich will set-up lots of companies, trusts, and what not, through which they will "invest" their funds (another way to make it not income). There were all manner of other manipulations that the comprehensive article(s) in question highlighted.
It all combines to mean that the ultra-rich, exploiting these loopholes, can end up paying, for example, 10 000 tax out of billions. The only way you are ever going to be able to use these loopholes if you have the means to investigate and exploit them (like be able to have teams of lawyers and accounts work out what you can do (and what is the best option).
I shouldn't really use the term "loophole". It is entirely possible, arguably probable, that this situation is entirely intended.
Obviously, Joe Public has no right to access such things.
I apologise for the lack of linking and stuff, as this is coming from memories on something read a longtime ago. I will, though, deal with this aspect later (kind of late atm to get into that task).
Take your time. I rush at times and have to end up apologizing because I didn't fact check. This info is mostly for educational
purposes since most of us don't have enough money to do what the big money men do.
