Tax Optimization for Freelancers VS Investors VS Business Owners

Today we're covering an interesting topic that one of our subscribers requested. How to optimize taxes depending on your status. We'll be covering tax optimization for freelancers, investors, and business owners and we'll point out what are some of the best things to do for each of these groups.

So let's start with freelancers. In many countries, you'd be considered as a worker and your income would be taxed accordingly. Many places tax active income more than they do passive income. So, what comes to play here is how much money you're making in a year. If you're making less than 100 000 USD or Eur there are many things you can do in order to pay low or no tax at all. There are special regimes in places like Romania and Slovenia that you can take advantage of if you set yourself up properly.

The next group is investors. So here's an interesting thing, one could be an active (active trader) or a passive income earner as an investor (long-term holder), depending on how long do you hold your positions before flipping them. Depending on this there are different places that can work for your situation. The main difference between the investor and a freelancer is that the investor is not actually doing the work.

If you're a business owner things get more tricky. Depending on the nature of your business there are different things that can be done to optimize your taxes. You can move to a zero-tax country, such as UAE, or you can open an offshore company in a favorable jurisdiction. Business owners can have some work done outside of their country of residence, it's not just them doing the stuff for the company - this is the main difference between them and freelancers. There are many things you can do in different countries once you take dividends.

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We are Offshore Citizen team. We help people become global: get a second passport, set up a second residency, pay less taxes, do banking abroad, etc.

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Author: Michael Rosmer

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[alexrappoport]

Great video as always, Mike. I have a question that I want to ask you though. In regards to a Singaporean holding company for investors, don't you think it's going to trigger the CFC rules?

[ilya]

How big investments should be to make sense with Singapore company + living in Portugal under NHR?

[TJ-cgmq]

..Hi Michael -: what if we're all three .??? And what would you suggest to British Citizens.. .. now that Tax has been increased in the UK?!

[cryptoFi]

Great video again man, thank you! Video idea: living in Scandinavia and running a company in Romania, Bulgaria, Cyprus or even Dubai?

[Carrie-jx]

Do traders need to set up a company or trade using individual account?

[straight]

What about the freelancer that moves around? The digital nomad. All their work is in the cloud. Would they be liable for tax on income earned only while physically present in each country? Seems like a nightmare to calculate, and I suspect few actually do it.

[Frugal_granny]

Michael, aren’t you in Bulgaria? It’s where we are trying to relocate to. Would love to email n ask some questions.

[parkerhoeppner]

Any thoughts if I’m a freelancer looking to move to Thailand? Not sure if making a foreign company and paying dividends is worth it.

[tinglestingles]

I'm assuming the term 'retirees' differs in every country? AND retirees could still be freelancers, investors, or business owners too.