Avoiding crypto taxes legally: getting citizenship in Dubai?

[cr1776]

You should also find out if your country taxes worldwide income.  E.g. the US takes the income of its citizens worldwide, perhaps a consumption tax will eventually remedy that or no capital gains taxes on crypto for US citizens.  I believe Eritrea and Hungary (with some exceptions) do too but no other countries do so.

So you might be able to become a permanent resident somewhere else where you wouldn't be taxed and not have to deal with citizenship.  Perhaps Dubai or somewhere else, this would be something to ask an expert about.  Some are costly even for that, but some might not be if you have a skill that they could use or you had an employer sponsor you.

[peter0425]

If anyone has experience in Dubai, please share this.
If other countries are good for this, please share.

Monaco is known to be tax haven for millionaires and billionaires. Being one of, if not the wealthiest city in the world, they are hell bent on maintaining the status. Anyone with minimum €500,000 can be a citizen of Monaco as far as I know. And no need to pay taxes in here. They do not tax income.

I also want to know what it takes to stop being a resident for tax purposes in your own country.

Renunciation but it’s different process for each country. Some may even not allow it.

Maybe I have to give up my nationality for this?

You don’t really have to. You just can be a dual citizen.

[cr1776]

If anyone has experience in Dubai, please share this.
If other countries are good for this, please share.

Monaco is known to be tax haven for millionaires and billionaires. Being one of, if not the wealthiest city in the world, they are hell bent on maintaining the status. Anyone with minimum €500,000 can be a citizen of Monaco as far as I know. And no need to pay taxes in here. They do not tax income.

I also want to know what it takes to stop being a resident for tax purposes in your own country.

Renunciation but it’s different process for each country. Some may even not allow it.

Maybe I have to give up my nationality for this?

You don’t really have to. You just can be a dual citizen.

And you may not even need citizenship, just residency.

[WeThePe0ple]

If you are considering moving to another country permanently to avoid tax you need to have a rethink. Have you considered your work, security, and family? There are other ways to avoid tax, just seek the advice of a professional. I can only move to a country that is better than my country to avoid taxes.

It is still a vague idea. I'm just considering my options. For work, I'm a physiotherapist and an osteopath (alternative branch of medicine, somewhat like a chiropractor). But I own a good property in Europe and I intend to rent it out for passive income while I am abroad. It takes away the pressure that find a job immediatlely. There are also substantial inheritances coming my way, but taxes here are terrible. I want to move as many financial assets as possible abroad, preferably outside of the EU. European governments are broke and I get a clear feeling that our politicians are going to look for money from people who own hard assets. A lot of things they say are similar to communism.

My fiancé is from Brazil. She owns a property there too. We can live in it for free and make rental income from here in Europe.
But Brazil isn't particularly known as a tax friendly country for crypto either. And there are issues with safety and education (we intend to have kids)

One of the main things is that I want to move outside of Europe with her.
Because if I ever transfer money from DeFi to CeFi (a friend of mine made an account with Revolut, which is based in Lithuania) it takes exactly 1 day before the tax authorities know that you own another bank account in a European country.

I just read that investing about $200 000 in real estate in Dubai, qualifies people for citizenship.
My crypto portfolio is not worth $200 000 yet but I believe it will definitely get there one day in the next 10 years.

But do you have other asset than just less than $200,000 that in your belief will grow bigger than $200,000 in this bull market?

Real estate

What will you do in Dubai to live there, like your income, spending and more?
Make sure you know that living expenses in Dubai is not cheap.

https://immigrantinvest.com/blog/tax-free-countries-en/
https://nomadcapitalist.com/global-citizen/freedom/the-safest-low-tax-countries-in-the-world/

I mainly intend to own a bank account there, cash out my profits and keep them miles away from the IRS in my country in Europe. I know a BTC whale who sent his parents for early retirement. The guy is just 30 years of age and goes to Dubai twice per year just for managing his funds. He parked most of his profits there, and some others in Switzerland. Although I have heard that Switzerland is no longer that tax paradise that it used to be.

I have been in crypto for 2 years now. I own BTC and some altcoins that have done well. But I have not taken any profits because I know that this transaction history will be demanded by the bank, and a 30% tax hit will be imminent. I'm up 6x in XRP for example but just accepting the price swings has a better financial outcome than taking profits and paying 30%. To me it is like cashing out money from a ATM and paying 30% conversion fee, which of course is a total ripoff.

I am not skilled/experienced enough to safely work with non KYC and also if I can not show the transaction history, banks will not even accept my profits.
One of the things I consider doing with for example XRP is like this:

I move 4000 XRP from a European CEX to my hardware wallet in 2024. Moving assets to a hardware wallet is not taxable.
At the peak of the market in 2025 I move these tokens to a CEX like Binance, located outside of the EU.
I sell XRP for profit (taxable, but I don't intend to declare), and convert those profits to stablecoins. In 2026 I will reinvest these stablecoins at the bottom of the bearmarket. For example for 6500 XRP, which is 2500 more XRP than what I originally bought.

If I convert crypto to cash (bank account) in 2026 for example, I move the original 4000 tokens back to the European CEX and I can sell them there. So it looks like the 4000 never left the hardware wallet.
The banks will ask for the transaction history. I will show them the history from the European CEX. This is a buy and hold strategy (low tax).
I will not show them the Binance history and these additional 2500 tokens I will not sell. Binance is located outside of the EU.

This isn't legal so I assume that most people don't think it is a good idea.
But neither is paying 30% tax. I'd rather never sell, keep everything in BTC and pass it to my kids in 2050

[moderator's note: consecutive posts merged]

[JiiBs]

It depends on many factors. e.g. in "cheaper" countries you will not have proper medical care and overall services, you will face corruption (i.e. a lot of hidden costs), if you have family then there's a good change the schools are not great. For some this is a problem, for others it's not. Keep in mind that living in a country is significantly different than doing one week of holiday there.

It’s a case of you can’t eat your cake and have it.
There are reasons why they are referred to as developing or underdeveloped countries. Moving down there means, you would be exposed to the conditions of living there as well. Though the plans of leaving from a property rentals in Europe might work, you would have security challenges depending on where you find yourself, no insurance, lack of basic amenities and a host of others.

[HotSecret]

There are many ways to avoid taxes, there are many ways to exchange currency, from intermediaries to escort girls in Dubai  ) Better not try to avoid taxes, spend them on pleasure and relaxation) 

[tread93]

I just read that investing about $200 000 in real estate in Dubai, qualifies people for citizenship.
My crypto portfolio is not worth $200 000 yet but I believe it will definitely get there one day in the next 10 years.

Tax rules in my country are not clear but our IRS has a bad reputation and I do not intend to ever cash out my crypto holdings to any regular bank in Europe.
I prefer that my government has no idea that I even hold crypto. Cashing out here will immediately flag the IRS to check out all my earnings, also the work related ones. The IRS never leaves anyones home without a serious tax bill. In my neighboring country Holland, citizens already have to declare crypto holdings (even unrealized gains) so that the government can tax people just for holding BTC. This is theft.

I only intend to cash out crypto profits in countries that have 0% crypto tax and a proven track record of this. They also have to have a reputation of not sharing financial information (property, account balances..) with other countries.
For now I think that only Dubai has this, but I believe that Donald Trump is capable of doing this in the USA as well.

If anyone has experience in Dubai, please share this.
If other countries are good for this, please share. I also want to know what it takes to stop being a resident for tax purposes in your own country.
Maybe I have to give up my nationality for this?

One of my ideas is to rent out my property in Europe, move to a low cost nation (I like South America) and live from the rental income there. I can invest in crypto on the side. But if I remain a tax resident in my country, I am still obligated to declare all assets and properties in other countries too.

Why do they have to tax our crypto holdings too? They already tax literally every other thing. This is why cash is king, you can't tax cash if it's peer to peer. You should look into going to the Cayman islands they don't tax on any earnings led alone crypto gains. If I could I would go there. It's just so expensive to be there! You get no taxes but you have to pay duty and also the local food and products are pretty pricey all around.

[Ziskinberg]

There are many ways to avoid taxes, there are many ways to exchange currency, from intermediaries to escort girls in Dubai  ) Better not try to avoid taxes, spend them on pleasure and relaxation) 

Tax avoidance is a legal move, what’s illegal is tax evasion.

So if OP can come up with a smart way to avoid taxes without messing up his lifestyle, he shouldn’t hesitate to do it.
As investors who already made profits in crypto, that just proves we’re smart enough to legally dodge any heavy tax hits.

[karabiber]

There are many ways to avoid taxes, there are many ways to exchange currency, from intermediaries to escort girls in Dubai  ) Better not try to avoid taxes, spend them on pleasure and relaxation) 

Tax avoidance is a legal move, what’s illegal is tax evasion.

So if OP can come up with a smart way to avoid taxes without messing up his lifestyle, he shouldn’t hesitate to do it.
As investors who already made profits in crypto, that just proves we’re smart enough to legally dodge any heavy tax hits.

There may be ways to avoid taxes without actually leaving your place of residence. In Dubai, there are free zones like the DMCC Crypto Center, where you can set up private crypto companies. If you're an individual and a small investor, you have a tax advantage. You can both convert your earnings through your company and avoid taxes. I am not very familiar with the details, but there is such a situation. Dubai, the United Arab Emirates in general, is a very attractive place for crypto investors, but I don't know if it's a wise move to relocate just because of the tax.

[NotATether]

It all depends on whether you want to live in Dubai or not. If not so, then no point of moving your tax residence there, don't you think?

But let's say you like to live there long term:

- There are already ways to reduce your tax bill legally in your home country, but they are elaborate and require help from a tax lawyer (OffshoreCorpTalk can help answer this)
- If you want to become a UAE national, you have to give up your current citizenship first. In the case of the USA, this makes you inadmissible as the renunciation was for tax evasion reasons.
- You will need a lot more than $200,000 if you want to make that investment, as other expenses can easily quadruple this amount.

[Davidvictorson]

If anyone has experience in Dubai, please share this.
If other countries are good for this, please share. I also want to know what it takes to stop being a resident for tax purposes in your own country.
Maybe I have to give up my nationality for this?

Don't give up your nationality for this. It is not a good idea. If you give up your nationality for this what becomes your gain? Do you end up being a citizen of the new country? Would you have the same rights as them? Would you enjoy the benefits which your current country affords you? In my estimation find very innovative means to get tax exemption just as the rich do. You have have your crypto legally and be tax exempt to an extent. I think it is possible. Speak to a legal professional about it.

[wheeljunkie]

In my neighboring country Holland, citizens already have to declare crypto holdings (even unrealized gains) so that the government can tax people just for holding BTC. This is theft.

Yes, Orwellian nightmare and theft.

If anyone has experience in Dubai, please share this.
If other countries are good for this, please share. I also want to know what it takes to stop being a resident for tax purposes in your own country.
Maybe I have to give up my nationality for this?

One of my ideas is to rent out my property in Europe, move to a low cost nation (I like South America) and live from the rental income there. I can invest in crypto on the side. But if I remain a tax resident in my country, I am still obligated to declare all assets and properties in other countries too.

My advice is to pick a better country. Dubai is very expensive and you won't like it there. You must do some analysis of your expected spending. For example, it may be worth to go to a better and cheaper country which has a 10% tax rate on Bitcoin as you will pay off that difference pretty fast in realized savings. In terms of your passport, it really depends on the country that you are going to. Many allow dual citizenship but there are also others that don't. ChatGPT can give you a quick rundown of tax rates and the dual citizenship availability. You can look at some places in the Caribbean I think.

Tax avoidance is a legal move, what’s illegal is tax evasion.

So if OP can come up with a smart way to avoid taxes without messing up his lifestyle, he shouldn’t hesitate to do it.
As investors who already made profits in crypto, that just proves we’re smart enough to legally dodge any heavy tax hits.

The rich do it all the time, as the world is set up in a way that provides them with more instruments to do this than for regular folk. Actually, you should try to legally dodge as much tax as you can. Especially if you don't agree with how taxes are used.

[dkbit98]

OP I would stay away from Dubai if you plan to mitigate taxes, and getting their citizenship is not that easy.
Few days ago I saw Dubai announced changes in law regarding cryptocurrencies and they are adding much more restrictions.

[WeThePe0ple]

It all depends on whether you want to live in Dubai or not. If not so, then no point of moving your tax residence there, don't you think?

But let's say you like to live there long term:

- There are already ways to reduce your tax bill legally in your home country, but they are elaborate and require help from a tax lawyer (OffshoreCorpTalk can help answer this)
- If you want to become a UAE national, you have to give up your current citizenship first. In the case of the USA, this makes you inadmissible as the renunciation was for tax evasion reasons.
- You will need a lot more than $200,000 if you want to make that investment, as other expenses can easily quadruple this amount.

My wife is from Brazil. She has been a tax resident in Brazil for 10 years before she came to Europe. She has only been a tax resident here for the last 2 years.

I have read a recent article that says that Brazil has simplified its crypto taxes to a flat 15% capital gains tax, and only if earnings exceed 35k reais (about 5k USD) per month.

I have to get more clarity about that. This is very different information than what I read 6 months ago.

If this is true, we can truly consider moving to Brazil in the future.

Imagine we both quit our jobs in Europe, in 2030. We go to the town hall and declare that we are no longer tax residents here in Europe. She becomes a tax resident in Brazil again and we cash out all the crypto assets there. The tax is far lower and real estate is also much cheaper than here in Europe. It may not be as simple as I portray it here, but I hope that there is some perspective.

[The Cryptovator]

It's true Dubai is a crypto-friendly country. I never heard yet that you can get citizenship by investing $200K at all. Rather, you may get a residential card for 5 or 10 years. You must need to visit Dubai if you really want to know the reality. I know there are a lot of physical crypto exchanges from where you can cash out your crypto, but not sure you don't need to pay tax during investment there.

Better you go as a tourist there, meet the culture then decide. Unless someone living there can't assure you of something. It's quite interesting you want to move from your home country just for tax. If you are earning well, then I don't think it's a big issue to pay tax.

[BITCOIN4X]

I don't have any problem paying crypto taxes as long as the withholding percentage is acceptable. So far the government has collaborated with all local exchanges in implementing tax rules for traders and investors, so we actually pay taxes which are deducted directly on these local exchanges. I'm not saying this is an unfriendly approach for traders and investors from the government, but we don't really know where the tax revenue has gone all this time.

I just heard that Dubai doesn't implement a crypto tax, of course that's good, but I don't intend to move there and change citizenship. I am still comfortable living in my country which has so far been quite friendly towards crypto, even if the government does not legalize it as a legal tender.

[finaleshot2016]

Dubai is a solid country, really on the move to make crypto a global asset, they even had a token2049 event which shows they're very open and crypto-friendly but time will tell if they're still gonna be a crypto-friendly.

US making 0% crypto tax? Very impossible, good move for crypto people but he will prioritize US no matter what, look what happened to the tariffs he put, even US' neighbor country.

Actually, paying tax is no problem but here in my country, I can say that I don't want to pay taxes if ever since they these taxes goes to the politician's pocket and aren't being used to improve the digital sector which is I'm still eyeing out for. They're just imposing tax like the digital tax which is very high unlike to other SEA countries so making a crypto tax which is very greedy will gonna ruin the crypto community here.

[wheeljunkie]

Better you go as a tourist there, meet the culture then decide. Unless someone living there can't assure you of something. It's quite interesting you want to move from your home country just for tax. If you are earning well, then I don't think it's a big issue to pay tax.

Short touristic trip is not enough to understand how it is to live there. In fact, a lot of people make this mistake every year. They experience many good things during their visit, things which are much different than to the real situation of living there. They get disappointed soon after moving. 

US making 0% crypto tax? Very impossible, good move for crypto people but he will prioritize US no matter what, look what happened to the tariffs he put, even US' neighbor country.

Don't say impossible. There are already states where such a tax is at 0%, the only problem is the federal tax. While the chances are a bit low because democrats are crazy, it may still happen. Also, don't compare taxes to tariffs as that does not make sense. having a 0% tax rate on crypto would encourage big money to come to the USA.