If you could go from 40% to 5% in taxes just by moving to a tax haven jurisdiction, you would be saving money, without a doubt. Yet, how much money you can make or save by going offshore isn’t only attached to the genuine tax rate that you’re paying.
There are actually a number of determinants that motivate people to make and set aside more money once they’ve gone offshore. Setting up an offshore company can be a turning point if done right.
This article will cover the six distinct ways you can carry on with the life you need with more money in your pocket. They are as follows:
1. Reducing taxes
The first and foremost is reducing your taxes. This is obviously an easy way to save money and is a big win for many people.
Suppose you are pulling in around $500,000 a year, $220,000 of which goes in taxes.
Now, we put together a strategy for you where you could move from your home to a new country and only pay a little bit in taxes each year. Assume we get it down for you from $220,000 to $10,000 a year.
The money you save can go into helping your business grow, be saved for emergencies, or put towards early retirement. And all without having to sacrifice your quality of life. Thus, you gained $210,000 a year.
2. Reducing the cost of living
Suppose you live in Western Europe where you are paying about $100,000 a year to live. This includes the exceptionally high cost of rent where you are living. So far, you have around $210,000 in your pockets every year, making this cost of living much more comfortable to afford.
Moving from Western to Southern Europe would cut that $100,000 down to around $50,000 a year.
Not only do you get help from the massive tax break, but your living expenses are going to fall so drastically that you will have the opportunity to increase your quality of life.
You enjoy the sun, the warm weather and are very happy to live somewhere in the south where you could also have more money in your pocket.
Moving seems like such a simple thing to do to reduce your living cost, but it truly is an effective approach to save more money. When you look at folks in the United States, for example, it’s tough for people to save even 10% of their income.
So, not only do you get to cut down on the cost of what you need, but you get to redirect your money to pay for more of what you actually want to spend your time doing.
Thus, you gained $50,000 + ??? a year.
3. Reducing stress
When you are stressed, you aren’t productive. And, especially if you’re living a western lifestyle, you simply know that there can be a great deal of stress in the way you live.
Suppose this was the case for you.
Part of your stress came from the fact that you are still a US citizen. You have European citizenship now, but you are still filing all sorts of paperwork in the US, which you had to find and pay someone to help you with.
When you eventually did find someone who accepted to help you, you had to pay him $4,000 a year to do your US taxes. And you had to do the same for someone else to file your European taxes.
That is why we recommend that you have the right team of experts behind you instead of going out without a plan.
With our team behind you, we helped you cut what you were spending to file your taxes down to $1,000 a year in a straightforward way that reduces your stress.
Reducing your stress would increase both how much time you have to grow your business and the quality of work you can simply put into that growth, no need to mention the quality of life you enjoy while doing so.
4. Taking “off-limits” opportunities
Several people may desire to make an investment into something like cryptocurrencies but are worried about the constraints countries like the US put on doing so.
The truth is that there are investment possibilities that you could be missing out on by staying in your home country instead of proceeding someplace where the regulations are more friendly. Investments that you would not be able to make until you get your offshore banking account set up or become a citizen someplace else.
But, you do have to acknowledge whether or not you are losing money by not catching specific opportunities due to the fear of not comprehending how to go about it or where to go to take advantage of those opportunities.
Looking for gains ???
5. Increasing partner revenue
We know a number of couples where one person is really crushing it making half a million or more a year, while the other person has a job that they don’t really want to stay with. The partner just doesn’t know where to go when they leave.
Suppose you have a job making $50,000 a year. That income will vanish when you leave Western Europe because you can not keep working that job remotely.
But, you have some skills that you can take into freelancing. You can find clients and do your work from anywhere in the world.
We estimate that you could be making closer to $80,000 a year doing freelance work. There’s a minor tax that we are not really taking into consideration, but you are essentially going to be adding an extra $30,000 a year to your income.
Some people get comfortable with these situations and are okay with the $50,000 they’re making, but specific opportunities come from the forced entrepreneurship of driving overseas. Learn more about Impact of COVID-19 on Offshore Business.
Thus, gained $30,000 a year.
The point of this article is to see how much money one can save by going offshore. From what we have estimated in this article, you will have around an extra $295,000 to do what you want before we even start calculating the value of all the question marks.
There are several people out there who could profit from these strategies. Several people sit on the sidelines at home, not doing all they can and missing out on the potential.