There are a lot of new political unanticipated developments that may also have tax implications. Labour in the UK and the United Left in France are winning elections. These guys are not immediately known for handing out tax gifts or lowering tax rates. On the contrary, in France, leftist rhetoric is back. There is again talk of even more (wealth) tax, even putting a ceiling on what can be inherited and so on…In short, all possible recipes to drive hardworking and wealthy people out of the country.
Exit tax?
But those who leave don’t just want to leave; no, they have to pass by the cash register one last time, a matter of squeezing the lemon once more. Yes, this is called an exit tax!
There are some nasty exit taxes that already exist. There are already nasty exit taxes in Australia, South Africa, Canada, Scandinavia, and …nv; the Netherlands. The Netherlands also plans another exit tax for privates in 2025. Now, there was one for large shareholders.
You will need to pay. So, fleeing fiscally will become more difficult or an expensive joke. Governments are stuck with huge debts. They can hardly cut certain expenses because then they will lose voters. So they pluck the remaining chickens that still have some meat on them or even slaughter them. This is short-term politics. After that, ExiEo more chickens are laying eggs in the economic desert and the great financial void.
What could such an exit tax look like? Oh, that can take many forms. For example, in Norway, you can only come back into the country for up to 20 days for three years, or they tax you on your worldwide income. In the Netherlands, they are now planning an exit tax where you are still fully taxed in the Netherlands for the first five years after you leave the land. The Canadian Exit Tax If you cease to be a Canadian resident in a given year, you are deemed to have disposed of certain types of assets at their fair market value and to have reacquired them immediately for the same amount. The taxable gain (50% of the deemed capital gain) that results from the deemed disposition of the assets is included as taxable income in the tax return of the departing individual and taxed at a rate of up to 53,53%.
Exittax in South Africa. Since the 1st of October 2001, a capital gains tax has applied to the deemed disposal of assets of natural or legal persons intending to become non-residents. More specifically, the day before a person becomes a non-resident, her worldwide assets will be regarded as disposed of at market value. This will automatically trigger the capital gains taxation. Capital gains taxation applies only to profits from selling assets (i.e., the difference between the income from the disposition and the costs associated with the acquisition). South African immovable properties are not deemed disposed of as they are always subject to the South African tax law.
Taxpayers who cease to be South African tax residents must pay the applicable taxes on the day they leave South Africa, even if the tax year concerned has yet to end. If a taxpayer does not pay the tax on the day she leaves the country, Something similar happens in Australia.
So seriously, think about boosting your emigration plans anyway.
But to where? You can only settle in some countries. First, you have to have the right to live somewhere. And then it also has to be fiscally interesting. And there is more to life than taxation. You also have to like living there. You may want to live in country A, work in B, and have your assets in C. This is an ideal story for several reasons.
A customized solution must be found for everyone, and that is precisely what we are happy to do for you. Countries we can think of off the top of our heads are, for example, Bulgaria, Italy, Uruguay, Dubai, Malaysia, Portugal…
Contact us for more info or detailed advice at info@dehoon-dhp.com
