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  1. #1
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    Default Offshore trading account

    Hi,

    I dont know if its true, i heard that Offshore trading account arent taxable in DR. How does it work?

    Actually, i live in Canada and i have a trading account with an american firm for proprietary trading, but its not a compagny. Of course, i pay taxes on capital gain here in Canada, because of a treaty between Canada and the US.

    If i move to the DR and become a resident, own a house but dont have the citizenship, will i pay taxes on my capital gain made in my account in the US? That means that my money would stay in an american bank. I heard also that in Thailand if you have such an account you dont pay taxes as long as you dont import the money into a thai bank account. Is it the same in DR? What if i pay by interact or credit card or if i stay less than 6 months in the country?

    Frank
    thank you

  2. #2
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    Default

    Canada, too, has a tax treaty with the Dom Republic.

    Your question relates to your residency status.

    Resident Canadians are obliged to report their worldwide income, regardless of where it is earned.
    Canadians are taxed on their residency status while Americans are taxed (federally) on their citizenship, regardless of their residency.

    I am uncertain of the reporting requirements for Dominicans who generate income outside of RD.

    WW

  3. #3
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    Foreigners living in the Dominican Republic must pay taxes on their worldwide income from financial investments after their third year of residency in the country (Articles 269 and 271 of the Tax Code).
    Fabio J. Guzman
    Guzman Ariza
    Attorneys-at-Law
    Sosúa, Santo Domingo, San Francisco de Macorís, Cabrera
    Las Terrenas, Samaná, Bávaro (Punta Cana) and La Romana
    Dominican Republic


    [email protected]


    Website

    The opinion above should not be construed to be formal legal advice and was given without reviewing the facts and documents pertinent to the case. The reader should NOT act based upon this opinion without seeking professional counsel.

  4. #4
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    Default

    How is the Dominican government going to know a person has financial investments outside the Dominican Republic and what if the person already is obligated to pay taxes on their worldwide income to their country of citizenship if they are only a resident in the D.R.? Do they have to pay twice?

  5. #5
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    Default

    From what i know if you are a citizen of another country and you live less than 6 months in your country of origine you dont pay taxes in your country of citizenship.

    If you live less than 6 months in any country, except USA and Britain where its 6 months over 3 years you dont pay taxes. Thats what i have read on many website. Is it true, im not sure?

    But its a good question how do they know you have money in the US. But its not important you have to declare to the governement.

    What im asking is there a way to avoid taxes on capital gain made from a foreign account.

    From what i see even if you have a registered compagny in the Bahamas you still have to pay taxes on the profit of your compagny.

    If its the case my last option is the Bahamas or the Cayman where it is said you pay no personnal income taxes, no capital gain taxes and no corporate taxes.

    Frank

  6. #6
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    In the old days you could avoid taxes this way. It is not true any longer. All the offshore locations have slowly been forced by the US to give up whatever the US asks for. Its very risky. All it takes is a mad x girlfriend or x wife to blow the whistle and you can be arrested and end up in jail. If the US government is interesed in you there is no county in the world that will not give you up. This includes Switzerland. There are a number of books written about this but things have changed in recent years. Hell, they even put poor old Wesley Snipes in jail. Be careful.

  7. #7
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    Default Canada

    If i understand correctly, you are currently a Cdn resident.

    If you wish to leave Canada - officially - you or your accountant should file the "exit tax return" which declares that you are leaving the country. (this has been cited here before)
    At that point you are on record w/ RevCan that you are a non-resident.


    Technically, you should not be inside Cdn borders for more than 6 months in any year after that declaration.
    Whether you choose another residency is an option for you.
    Many countries have a "minimum stay" requirement for thier residents.

    The last time I looked at it, Bahamas had a special residency classification for people who bought a house/land in excess of US$250,000. (maybe more now)
    Residency is granted quickly for this category but the resident is not allowed to work in the Bahamas.

    I suppose a good question here is - "Does a person actually need a residency?"
    You will need a driver's licence, health insurance, etc. and may need a residency for some of these things but it may be possible to become a "citizen of the world".

    Do people do this? Certainly, they do.
    We can all watch Shania Twain tonite on television from her Swiss residence (instead of Timmins ON).
    Do you think her tax bill is very high? But she is a Swiss resident.

    Can anybody flesh this "world citizen" idea/concept out ?

    WW

  8. #8
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    I think Mr Guzman has covered much of my questionnings.

    Its not possible the way i see it to live in DR without paying taxes, unless maybe (if im correct) like Webster said I keep my canadian citizenship but leave Canada (if i come back dont stay more than 6 months) and live in any other country of the world less than 6 months per year. Like having a house in DR, France, Thailand and stay only 4 months per year in each of them. (an expensive solution unless your a billionaire)

    The Bahamas maybe my last option, i have to buy a house anyway and i rather be under the sun than snow 6 months a year paying high taxes.

    Most of what you say Webster i already knew, i just wish it was the same for DR since the cost of living is lower and you have a better choice when it comes to the house market.

    Frank

  9. #9
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    Quote Originally Posted by frankduc View Post
    I think Mr Guzman has covered much of my questionnings.

    Its not possible the way i see it to live in DR without paying taxes, unless maybe (if im correct) like Webster said I keep my canadian citizenship but leave Canada (if i come back dont stay more than 6 months) and live in any other country of the world less than 6 months per year. Like having a house in DR, France, Thailand and stay only 4 months per year in each of them. (an expensive solution unless your a billionaire)
    Yes, you keep your Canadian citizenship - definitely.
    And yes, you need a 3rd leg on the stool to avoid the 6 month rule.
    Maybe you stay in RD for 5 months or so, Canada for 5 months or so and going skiing somewhere for a couple of months... or go do whatever - just travel.


    The Bahamas maybe my last option, i have to buy a house anyway and i rather be under the sun than snow 6 months a year paying high taxes.

    Most of what you say Webster i already knew, i just wish it was the same for DR since the cost of living is lower and you have a better choice when it comes to the house market.
    Right about cheaper. I calculate living in Rd is less than half of my NoAmerican cost - food, restaurants, etc

    Frank
    WW..... trying a new answer method but the system doesn't like it.
    It wants to go outside the box ! Hell, I LIVE outside the box :-))

  10. #10
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    It's not just cheaper, you get more for your money. Here in Montreal at the starting price of 350k you get a very basic bungalow. In the Bahamas, you get about the same often in a close secure community near beaches. In the DR, bungalow turn into cottage double the size.

    I'm a bit disappointed since i saw on some site like escapeartist, that it was possible to trade with an offshore trading account and avoid taxes on capital gain from foreign investment. I tried to display the link on another post but the forum seems to block it. That would mean those sites are lying about the possibilities to do so.

    Considering, if what i have read is true, that personnal income tax in DR are 25% it still better than 56% here. Unless, its like Canada and they have provincial or state taxes. Cause Canada is 31% federal + provincial and a lot of hidden taxes, that make us compete with Sweden or Finland when it comes to the top most taxed citizen in the world.

    Of course, you understand i'm only talking about legal way to avoid taxes, i'm not interested into going to jail.

    Frank

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