Hey yall. Looking for a nomad tax professional to help me craft an international/offshore banking solution. I have US and EU citizenship if that helps you recommend.

Israel Tax Opportunities Summary 🇮🇱

Met with the head of one of Israel's top law firms today. Here is a summary of the conversation:

Overall it is a high tax country, with some tax benefits

Personal: up to 48% tax, plus surplus that has been extended for the last years
Corporate: 23%, dividend rate depends if under 25% shareholding. Dividend tax 25-33%

Benefit 1: Rentals
Rental income 10% gross tax at personal level for residential properties, not commercial. If you have many expenses on a year, you can elect to tax on the profits only for that year = no tax

Benefit 2: Creating real business in the country
If investing in Israel with employees and keeping know-how locally - corporate tax rate in single digits, dividends for non-residents 15%

Benefit 3: Law of Return
For descendants of Jews that want to move to Israel, not only you get citizenship, but also 10 years exemption on all foreign incomes for returning jews who become Israelis, for incomes established before they become israelis.

Counts if transfer for asset purchase was initiated before. Doesn't get cancelled if you move out after. Counts EVEN for israeli investment if it was done before they move.

Example 1: Client moves to Israel. In the following year, he starts the purchase of a property. He will pay tax on this rental, even if the property is abroad

Example 2: Client moves to Israel. In the year before, he transferred the money to a Portuguese bank account. The purchase of the property occurs after he becomes Israeli. Rentals are not taxed

Example 3: Client invests in an Israeli startup before he becomes Israeli. Tax benefits of the law of return still apply even if he becomes Israeli.

Benefit 4: No inheritance tax

So main targets:
Investors for real estate
Invest in startup
Jewish law of return
Die in Israel and avoid inheritance tax

Also - higher income exemption amount for retirees and disabled

There is an exemption on first home sale of 1.5 million usd

Company opening takes 3 days

Registered address planning is very important for companies, tax compliance is stricter or more relaxed depending on municipality

For inquiries/consultancies of specific questions, makes sense to get confirmation with local tax authorities to protect against criminal issues

Israel is VERY strict against fraudulent expenses for business, its worse than not declaring income. declaring false up to 15 years in jail, not declaring usually up to 3-10.

Israel can go back the last 4 years of declarations for tax matters, but up to 10 years for criminal matters (such as money laundering, fraud)

I want to drop here the strategy I use (applicable only if you do software development).

I live in 🇦🇲Armenia.
As IT business, making <285K€ in revenue we qualify for a simplified tax regime.
This allows us to be taxes at 1% on turnover.

I have a solo entrepreneurship (IE) with 1% turnover tax + social and military tax (<2% in total); I do a gun for hire software development here.
I also have an LLC with partners with 1% turnover tax + we have to have a salaried director (20%/PIT, we pay higher than minimum salary) + 20% taxes on a set of expenses + 5% on dividends (total tax burden <13%, but can be less than 10% total)

AMD is good currency, but if you want to get the money out add some 2-2.5% for SWIFT and currency conversions if you do not use crypto on top.

It is quite a simple system here.
They have tax residencey based on centre of vital interests OR 183+ days, meaning you do not have to spend 183+ days here if you do not want to, you just need a good essay on how your CVI is in Armenia.
Banking was easy to get at Ardshinbank (top bank with relatively little requirements).

Armenia does not tax your stonks income if earned abroad.

P.S. We tried to get things going in Georgia, but it all broke down when we figured out that Google does not support merchant accounts from Georgia. In addition to that, we found their tax treatment of Virtual Zone companies scary, same with SBS; in general lawyers and accountants in Georgia spoke more in terms of probabilities, in Armenia in terms of rules; locals are way friendlier in Armenia too; but Armenia is admittedly more boring and less diverse.

So overall recommend Armenia as a base, gonna stay here for 2-3 years.
Check this out: https://woodscenter.am/en ; visited over 20 coworkings, the best one till far found in Armenia.
Thesis over.

Looks cool, thanks for sharing.

Hey Alex! In this answer did you have in mind as well the ausencias esporádicas?

I wasn’t familiar with this term, but quick research suggest that ausencias esporádicas is in fact the opposite of what I wrote, as this is spanish tax resident that occasionally leave spain, withough loosing spanish tax residency status.

Anyone here working with a US company as a contractor and resident of India. My company issued stock options when i joined as a contractor but now they seem to be stuck because of Indian laws. As per FEMA/RBI it is not allowed to hold stock options in foreign company as a contractor/sole proprietor. Anyone here dealt with something similar or exercised their vested amount?