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Seeking offshore income advice

Raveling

Contributor
Read Millionaire Fastlane
Jul 14, 2019
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60
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I'm FINALLY in a place where I have to start thinking about this

Here's the deal. I will soon have offshore income coming in. I'm resident in Japan, Canadian and have no corporate entity.

I want to be as tax efficient as possible and fully legal about how I do it.

At first, it'll be modest, but I'm doing all that I can to make it into much more.

Should I start an offshore corporation? , probably, where's best and how do I do that right without being ripped of by shady looking online services?

I know that bringing any income besides living expenses into Japan will only meaning making the Japanese tax department happy, and while I think I can put around $6,000 dollars a year into a Canadian account without income tax, I hope to do a hell of a lot better than that.

First, how should I ask to be paid?

Short term, into PayPal may be cheaper than paying Japanese tax, but, assuming that's legal ( it's offshore income ) it's a short-term and expensive solution due to the fees.

What other options do I have to be paid digitally, and keep offshore income away from the Canadian and Japanese tax jurisdictions?

Once I've covered that, given my current physical location, where is the best offshore location to incorporate, store, & keep my income?

And finally and critically, how do I access said funds when I need to?

My long term goals are to be a digital nomad with a home/s or rental/s in at least one country with comfortable year round weather to return to when I'm not traveling.
 

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G. Wellthy

Contributor
FASTLANE INSIDER
Jul 21, 2018
40
33
55
I'm FINALLY in a place where I have to start thinking about this

Here's the deal. I will soon have offshore income coming in. I'm resident in Japan, Canadian and have no corporate entity.

I want to be as tax efficient as possible and fully legal about how I do it.

At first, it'll be modest, but I'm doing all that I can to make it into much more.

Should I start an offshore corporation? , probably, where's best and how do I do that right without being ripped of by shady looking online services?

I know that bringing any income besides living expenses into Japan will only meaning making the Japanese tax department happy, and while I think I can put around $6,000 dollars a year into a Canadian account without income tax, I hope to do a hell of a lot better than that.

First, how should I ask to be paid?

Short term, into PayPal may be cheaper than paying Japanese tax, but, assuming that's legal ( it's offshore income ) it's a short-term and expensive solution due to the fees.

What other options do I have to be paid digitally, and keep offshore income away from the Canadian and Japanese tax jurisdictions?

Once I've covered that, given my current physical location, where is the best offshore location to incorporate, store, & keep my income?

And finally and critically, how do I access said funds when I need to?

My long term goals are to be a digital nomad with a home/s or rental/s in at least one country with comfortable year round weather to return to when I'm not traveling.
You’ll quickly learn that tax advice is worth paying up for... I was a tax lawyer for 13 years and it pains me to think that you might make these calls without prudent tax advice.

Since I’m clearly not retained, this is not tax advice and cannot be relied upon.

You should not be both a Canadian and Japanese resident. Assuming “future nomad”, you might as well expatriate Canada formally (there are rules for this).

Generally speaking, the future world of tax policy will only “work” for above board individuals. Seek jurisdictions with TIEAs or Tax Treaties (Hong Kong, Singapore, UAE come to mind near Japan but Barbados, UK and the Channel Islands, and at this rate, the US are all the types of options you should be seeking).

If playing in tax treaty domains, the residency of the directing mind of the corporation is quite often relevant. So if you do not want to pay local residents to be the directing mind, which also adds risk unless you hire the high priced talent, part of your nomadic journey will include a permanent residence in the jurisdiction of your “offshore” (aka low tax but above board) jurisdiction.
 
OP
OP
R

Raveling

Contributor
Read Millionaire Fastlane
Jul 14, 2019
81
60
48
You’ll quickly learn that tax advice is worth paying up for... I was a tax lawyer for 13 years and it pains me to think that you might make these calls without prudent tax advice.

Since I’m clearly not retained, this is not tax advice and cannot be relied upon.

You should not be both a Canadian and Japanese resident. Assuming “future nomad”, you might as well expatriate Canada formally (there are rules for this).

Generally speaking, the future world of tax policy will only “work” for above board individuals. Seek jurisdictions with TIEAs or Tax Treaties (Hong Kong, Singapore, UAE come to mind near Japan but Barbados, UK and the Channel Islands, and at this rate, the US are all the types of options you should be seeking).

If playing in tax treaty domains, the residency of the directing mind of the corporation is quite often relevant. So if you do not want to pay local residents to be the directing mind, which also adds risk unless you hire the high priced talent, part of your nomadic journey will include a permanent residence in the jurisdiction of your “offshore” (aka low tax but above board) jurisdiction.
Thank you so much G. Wellthy. This is exactly the start I need.

I'm acutely aware just how clueless I am about this, which is why I asked.

Currently my first choice for country of residence is Panama because its amazing weather, wealth, political stability, proximity to two oceans and shared timezones with North America.

While I can't YET pay a dime for advice, I get that advice worth taking in this area is advice worth paying for. And since you are someone who knows you'll probably be the first person I reach out to when paying for said advice becomes and option.

Until that point I'll suck up tax implications whereever necessary as personal income until I have the money and knowledge to pull the trigger on doing it right.

Until then, I would appreciate any and all good free advice yourself or others on this forum are willing to share as a starting point for my own learning so that when it comes time to pay for advice I'm at lease as educated as I can be so I can make the soundest judgements and decisions I possibly can.

Upon reflection I think I need to clarify one point. I've been living and working in Asia since 2005.

As far as I know that means I'm already long ago officially expatriated from Canada. If I'm incorrect, could someone please tell me where to look for how to officially expatriate?

While Japan is very nice, and safe, the summer weather sucks (hot and humid) and I want to live where the weather is like Canadian summer year round (like Panama). For my primary country of residence

Thank you again for giving me a proper starting point G. Wellthy.

timbgreen
 
Last edited:

G. Wellthy

Contributor
FASTLANE INSIDER
Jul 21, 2018
40
33
55
Thank you so much G. Wellthy. This is exactly the start I need.

I'm acutely aware just how clueless I am about this, which is why I asked.

Currently my first choice for country of residence is Panama because its amazing weather, wealth, political stability, proximity to two oceans and shared timezones with North America.

While I can't YET pay a dime for advice, I get that advice worth taking in this area is advice worth paying for. And since you are someone who knows you'll probably be the first person I reach out to when paying for said advice becomes and option.

Until that point I'll suck up tax implications whereever necessary as personal income until I have the money and knowledge to pull the trigger on doing it right.

Until then, I would appreciate any and all good free advice yourself or others on this forum are willing to share as a starting point for my own learning so that when it comes time to pay for advice I'm at lease as educated as I can be so I can make the soundest judgements and decisions I possibly can.

Upon reflection I think I need to clarify one point. I've been living and working in Asia since 2005.

As far as I know that means I'm already long ago officially expatriated from Canada. If I'm incorrect, could someone please tell me where to look for how to officially expatriate?

While Japan is very nice, and safe, the summer weather sucks (hot and humid) and I want to live where the weather is like Canadian summer year round (like Panama). For my primary country of residence

Thank you again for giving me a proper starting point G. Wellthy.

timbgreen
I’m out of the tax game. Slowlane... in LA... during rush hour. Happy to provide some advice, that is not formal legal advice of course. If you need help finding the right advice when the time comes, reach out.

Panama has worked well for individuals that just want a super low cost lifestyle. It probably won’t work for you nor any other businessmen (that aren’t trying to hide their affairs).

This is because Panama has chosen secrecy over becoming a financial hub. The secrecy jurisdictions will become more and more alienated. You may have seen the US information raids into Panama.

Pick above board jurisdictions. I prefer tax treaty jurisdictions. TIEA jurisdictions may survive the OECD’s continuing tightening of international tax policy.

These jurisdictions will make your money flow between countries smooth. Which is more important in business then just saddling up in a “privacy” country and counting down your days.

I’m surprised none of those southern Americas jurisdictions have figured out just how good Barbados, Caymans, Bahamas, Luxembourg etc have it. Or maybe there is just too much pressure to prioritize privacy over transparent tax efficiency. Pressure from unsavouries.

I could see Mexico getting a lot of headquarters if they became the Luxembourg of our two continents.
 

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