How to choose the best tax residency?

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Taxes. Does the sole sound of the term cause you goosebumps? You’re not alone. An unavoidable fact of life, taxes can be a complex matter to handle, especially for global citizens. The good news is, your physical residency doesn’t need to match your tax residency.

With multiple sources of income, several business operations, or property spread across locations, a lot of your income might be lost through inefficient tax management. To alleviate that you might want to consider paying at least some of your taxes elsewhere, that is getting a tax residency abroad.

As with all fiscal matters, it’s best to consult the experts. At Relocate Antigua we’re happy to offer accounting, administration, and bank evaluation assistance among many other VIP services.

What is a tax residency?

Each country or region has a specific definition of who it considers a tax resident. In many places an individual is considered a tax resident if they spend a greater part of the fiscal year in that location, that is more than 183 days. This rule functions for example in the UK. In contrast, in the USA, you need to meet the substantial presence test, which has slightly different specifications.

To get the latest details on who your country considers a tax resident, it’s best to visit your national tax authority website.

As a tax resident you are required to pay taxes at the rates specified by the place of your tax residency. Different countries have different tax rates and different rules on the types of financial activities they tax. Depending on the types of financial activities or sources of income you have, some locations can be more or less beneficial from a tax perspective.

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Tax residency: Points to consider

The choice of tax residency depends on several factors.

1. Business or individual tax residency. Taxes for individuals and businesses are different. You might want to only relocate your business abroad to benefit from better corporate tax rates, but yourself remain a tax resident of your original country.

2. Double taxation treaties. If you get income in one location, but transfer it abroad, you might be taxed in both places. To help avoid paying taxes twice countries enter double taxation treaties to enable individuals claim tax relief.

Antigua and Barbuda, for example, holds bilateral taxation agreements with Denmark, Norway, Sweden, Switzerland, and the UK, and double taxation treaties with the UAE and the UK.

If you’re interested in learning more about how to benefit from Antigua and Barbuda’s tax residency, book a consultation with our experts at Relocate Antigua.

3. Types of income. Different tax rates apply to different types of financial activities. For example, individuals can be taxed on income, inheritance, real estate or asset sales, among others, and corporations can be required to pay tax on dividends or capital gains. Most importantly, companies are subject to different tax rates depending on the country, their income or type of business they conduct.

International Business Corporations (IBCs) will often benefit from very advantageous tax rates, for example, in Antigua and Barbuda IBCs are exempt from corporation tax for 50 years from incorporation.

How to establish the best tax residency for you?

  • Figure out where your current tax residency is and what your current tax rates are.
  • Establish which types of financial activities apply to you.
  • Calculate where you could introduce more financial efficiency.
  • Shortlist countries with the best citizenship and residency programs.
  • Check local tax rates on financial activities that matter to you most.

Taking control of where you pay your taxes is a privilege of being a global citizen. While fiscal matters can seem convoluted, investing time into investigating the best option will bring high returns in the long run.

If you need assistance in managing your financial activities in Antigua and Barbuda, our experts are here to provide financial advice tailored to your individual and business needs.

Citizenship by Investment: Factors to consider

There is a variety of Citizenship by Investment programs. However, the programs differ quite a lot on several main factors:

  • Minimal investment amount. Numbers can go from as low as $100,000 for CIP in Antigua and Barbuda, to approximately €2 million (around $2.24 million) in Cyprus.
  • Type of investment allowed. Some countries allow a simple one-off donation to a local fund, for example the National Development fund in Antigua and Barbuda, or the National Economic Fund in St. Lucia. Others will involve additional investments. For example, Cyprus requires an extra investment in real estate, and in governmental bonds.
  • Time per year required in the country. In Monaco, for example, it is only after 10 years you can apply for a citizenship. In other places, like Grenada, there are no requirements regarding the length of stay—you don’t even need to visit the country at all.
  • Processing fees. There is always a cost associated with application processing. The final amount depends on whether you’re applying solo, or want to extend the CIP privileges to your spouse or other family members.

Needless to add, as with most governmental and legal procedures, the speed of processing your application and the complexity of legal rules surrounding the process will also vary by location. At Relocate Antigua we will be happy to assist you with our VIP service to make the process smoother.

It’s hard to keep track of all requirements and how they vary by location. What we’re happy to note is that Antigua and Barbuda is one of the friendlier jurisdictions for Citizenship by Investment Programs.

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Citizenship by Investment: Your top options

The last point leads us smoothly into investigating top countries for Citizenship by Investment programs.

Disclaimer: Below we quote the latest sums and figures, but they can be changed by the country government departments responsible for the Citizenship by Investment arrangements. We therefore do not guarantee that they will be current at all times.

Antigua and Barbuda: Citizenship by investment from $100,000

Considering all the key factors mentioned above, Antigua and Barbuda ranks among one of the best Citizenship by Investment Programs available. We’re sure you want to learn why!

Antigua and Barbuda citizenship comes with several chief benefits

  • Strong passport. With a passport power rank of 25 in June 2019, the citizenship of Antigua and Barbuda gets you easy access to over 130 countries, including the entire EU and the UK.
  • CARICOM membership. Antigua and Barbuda is also a member of CARICOM, a union of 15 Caribbean countries created with an objective to promote economic ties.
  • No capital gains or estate taxes. That means you pay no tax on income generated outside of the country.
  • Low minimum stay. During your first five years as a citizen, you are only required to spend five days in the country. But, trust us, considering the weather and local lifestyle, you will probably enjoy staying in Antigua and Barbuda for longer! And we’d be happy to assist you with relocation services.
  • Citizenship for eligible family members. Antigua and Barbuda’s citizenship can encompass additional family members. Moreover, the fees for covering extra family members are relatively low— for a family of up to four people you’ll pay just $44-48k in processing and due diligence fees.

Now for the best part of Antigua and Barbuda’s Citizenship by Investment program: the required investment.

The minimal investment you need to make is just a $100,000 non-refundable donation to the National Development Fund. This is one of the lowest barriers of entry you will find among even the top Citizenship by Investment programs!

If you prefer other investment types, you can also opt to allocate $400,000 into real estate in Antigua and Barbuda, or invest $1,500,000 into a business venture.

Ready to proceed with Antigua and Barbuda Citizenship by Investment program? We’ll be happy to explain the details and help you kick start the process!

Dominica: Citizenship by Investment from $100,000

Like in Antigua and Barbuda, Dominica’s Citizenship by Investment program is known to be one of the cheapest in the world. In July 2019, Dominica’s passport comes high in the Arton’s passport power ranking, granting easy access to 125 countries.

What else contributes to the appeal of Dominica’s Citizenship by Investment programs? Here are three extra reasons:

  • It doesn’t exclude applicants from any country.
  • Quick processing time.
  • Low minimum amount for real estate investment.

Grenada: Citizenship by Investment from $150,000

Grenada joined the ranks of countries offering Citizenship by Investment programs in 2013.

While the program is cheap, it has some limitations. For example, as it comes to real estate investment, you can only invest in specific, approved projects.

Perks of Grenada’s Citizenship by Investment program include:

  • Access to the USA E2 treaty investor visa. In common language it means that Grenada’s citizens can also reside in the U.S. and operate a business there.
  • Visa-free/VOA access to Russia and China. This is a unique feature among CIP programs!

Malta: Citizenship by Investment worth a million!

In terms of passport power rank Malta’s rank 4 (in July 2019) beats all countries offering Citizenship by Investment programs. It’s perhaps no wonder then than the cost of obtaining Maltese citizenship is high.

Malta’s Citizenship by Investment program requires three different types of investments. Apart from a donation to Malta National Development and Social Fund, and a substantial investment into real estate, you also have to allocate money to government bonds. Altogether the minimal investment value amounts to more than a whopping $1 million.

A million dollars can sound like a big expense. But, the benefits that come with Malta’s Citizenship by Investment program are numerous. Most importantly you get an EU passport, which means you can study and work freely in any of the EU countries.

Secondly, once obtained, the citizenship will not only cover all eligible dependents, but is also hereditary—the nationality will be passed to your children.

It’s a fact that Malta’s Citizenship by Investment program is one of the most expensive in the world. However, as always, the real assessment depend on your personal cost benefit analysis.

Summing up: Is Citizenship by Investment for me?

To sum up the considerations above, getting a second citizenship:

  • Comes with a lot of privileges.
  • Can take a lot of time, and involve dealing with complex local regulations.
  • Can be made easier in jurisdictions that offer Citizenship by Investment programs.

The amount of minimal investment and privileges included varies greatly among the top Citizenship by Investment programs. Some of the programs which combine low initial investment with the quickest processing times are offered by Dominica, Grenada, St. Kitts & Nevis, and Antigua and Barbuda.

At Relocate Antigua we assist you in getting a second citizenship in Antigua and Barbuda. Whether you’re interested in Citizenship by Investment, residency, or, even if you’re not sure yet, get in touch!

Our experts have already helped countless businessmen and entrepreneurs and are keen to share their expertise with you to help you choose the right option. Join other global citizens in an oasis of peace in the Caribbean Sea!

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