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Questions: The job postings, tax implications, Asian banking, Switzerland, Belize

April 30, 2010
Las Vegas, NV

It’s chilly in Las Vegas, but I’m having a great time meeting so many subscribers here at the Casey conference; I’m pleased at how many have turned up for the event, and I’m always humbled by the exceptional people we have in our community.

My only regret is that the conference organizers could not allocate more space for Sovereign Man readers, and I will personally ensure this doesn’t happen next time.

As I need to get going shortly to mingle with all the incoming attendees, let’s jump right in to this week’s questions:

First, a question that I have been asked hundreds of times over the last two months– “Simon, several weeks ago you posted two job openings on your website for people who were interested in working with you. What is the status of those positions?”

We recently filled both of the positions. It was one of the more difficult business decisions that I’ve had to make given the quality and number of applications that we received. We may be hiring again soon, and I will post that to the website as well if/when the time comes.

Second, Dana asks, “Dear Simon, if I trade US/Canadian financial markets from my home in Ecuador, would the government of Ecuador expect me to pay taxes on that income?”

No, especially as a non-resident foreigner. It’s the same in several countries, like Panama. This is one of the reasons for taking a multiple flags approach– having citizenship of one country, tax residence in another, and spending time/owning property in another.

Next, Neil writes, “Simon- I’m an investor and US citizen with residency in Uruguay. I want to hold gold coins in Hong Kong or Singapore, but I have a question– will I be able to open a bank account in Asia so that I will be able to wire money to my account in Uruguay once I sell my gold?”

Even as a US citizen, you should not have any problems opening a personal bank account at any number of multinational banks in Asia… try HSBC or Standard Chartered Bank, both of which have US branches and are accustomed to dealing with the Treasury Department’s arcane regulations.

Once you have the account open, you shouldn’t have any problems wiring the proceeds to your Uruguayan account once you sell your gold. Just remember a couple of things-

1) Singapore charges GST (VAT) on gold sales;

2) Don’t forget to fill out TDF 90-22.1, report of foreign financial account, each year after you open the new bank account;

3) You will have to report the proceeds of your gold sales on your tax return if you turn a profit.

Next, Dave asks, “Simon- I am currently living in Treviso, Italy, and I’m considering moving to Switzerland. However, I haven’t seen any posts about living in or considering Switzerland. What’s your take on the country?”

I like Switzerland. For me, it’s as close to a perfect civilization as it gets in this world. The government is [relatively] hands off, the people are [relatively] intelligent and freedom loving, and the country is quite clean and modern.

On the downside, the weather is too cold for my taste, it’s unconscionably expensive, and the people are boring.

Despite what has happened with Switzerland’s banking privacy, I still think the country is worthy of a number of flags, including banking, residency, citizenship, and tax home. I’ll be spending time there this summer and will report more at that time.

Lastly, Ken asks, “Simon, you wrote about Joel Nagel’s upcoming asset protection conference in Belize yesterday. It sounds worthwhile… but aren’t you negative about Belize?”

To be clear, I have no issues with Belize as a banking jurisdiction. True, I personally do not like Belize as a place to spend much time, but I don’t expect everyone to share my tastes.

I know that there are many subscribers who are very interested in Belize, and Joel Nagel’s asset protection conference is probably the perfect opportunity to go check it out.

Why? Because Joel is one of the best international tax attorneys in the business, so you’ll learn everything you need to know about protecting your assets. Plus, you’ll be able to open a Belize bank account through his personal connections, and you’ll have plenty of time to spend exploring the country to see if you like it.

About the author: Simon Black is an international investor, entrepreneur, permanent traveler, free man, and founder of Sovereign Man. His free daily e-letter and crash course is about using the experiences from his life and travels to help you achieve more freedom.

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Comments on this entry are closed.

  • Jay

    Hey Simon,

    I want to start off by saying thank you for your insights. It is very informative and has definitely changed my view of how to protect my wealth.

    You mentioned in one of your prior emails about India being a lost cost retirement possibility. How do you rate the country overall as an investment choice? I was considering investing in real estate in India as their economy is likely to grow long-term and was wondering what your thoughts were about it? Do you know of any current projects that are worth looking into for investment?

  • Clue?

    To Neil.

    Bare in mind, although HSBC brands itself as the world’s “local bank”, treat the branches internationally as just that. International.

    There is no special treatment for US citizens, or any citizens, who think they can have an international bank account and be able to access funds etc globally. Transferring money between two Asian HSBC branches for example, or an American HSBC branch and an ‘Asian’ HSBC branch is subject to regular international transferral rules and regulations. I.E. the branches are treated as franchises, and you may as well transfer funds from Bank of Timbuktoo to the Bank of Lard; essentially there’s no difference. International banking rules apply. You will be charged international banking fees, transferrals, commissions and exchange rates. You cannot link your American HSBC account from Hong Kong, and vice versa.

    HSBC and Standard Chartered are not universally generic platforms.

    P.S. If you actually do want to open an account in HK or Singapore you will need employment letter, proof of residence, HK or Sing I.D. or a passport, plus they will ask you for utility bills of your residence, to prove you live and work.

    Simple? No.

    • clarification

      To Clue:

      Not exactly true.

      You are correct in saying that a transfer from one country to another is subject to all the usual rules and regulations. Most countries require disclosure regarding the purpose of the transfer, and many countries still have capital controls. And you are right to say that each HSBC branch is run more or less independently. There is no single global bank.

      But some banks–HSBC in particular–are getting close. Under HSBC’s Premier program, the bank allows fee-free transfers between same-name accounts at its branches in different countries. And in many cases, the transfers go trough the highly automated and fast Global Transfer system (US to Hong Kong, UK to Thailand, for example).

      Also, many countries allow non-resident accounts and do not require local utility bills or a local work permit. Usual KYC rules apply, so you need a government ID with a real mailing address in your home country (and that can probably be a third country) and you need a passport, but a tourist visa is in many cases fine.

      But each country is different. Japan’s non-resident accounts are highly restrictive. No ATM card and only yen savings is available. China non-resident accounts are almost the same resident accounts. ATM card, multi-currency accounts and domestic transfers. Thailand is in between.

      I don’t work for HSBC, by the way. I am only a customer. And I have many complaints about the bank. Some call centers are a disaster. If the bank charges a mystery fee, good luck getting it back. But I have been generally satisfied with the service.

      One last thing: if you want to become an HSBC customer and are a US citizen, open the account in the US first. Get establish there. That will act as your banker reference at other HSBC branches.

      Standard Chartered and Citi are offering similar products, but I don’t know if they are any good. Probably not.

      • Clue?

        I think what you say is a bit unclear in that is only directed to a particular subset of potential bank clients, and needs further clarification – I was writing in response to the actual question the reader asked about banks in Singapore and HK.

        Now, to be sure, you will need proof of address – and with this goes utility bills. Further, if you fly to HK – for example – intending to open an account, and actually have enough papers on you and convince them to open an account (not the most easiest of things at the moment as assessments are getting more stringent) – they will then send out a letter to the address you provide. You must come back to the bank with this physical letter in hand before you can proceed. Be prepared for this hassle.

        As for the HSBC ‘Premier’ slight loophole to fees etc, not everyone will be willing to maintain an account in HK with at least HKD1 million in liquid assets in it at all times, or face exhorbitant fees. Similarly, you will have to maintain healthy – if not exhorbitant – balances in your US (or any other country) HSBC branch, in order to escape the transfer fees.

        In any case, what I say remains – HSBC branches are treated as seperate entities on an international fiduciary and regulatory basis. You may be able to escape some fees if you maintain high enough liquid bank balances to keep ‘Premier’ level status, but this may be at an opportunity cost of other investments in these volatile times.

    • lf

      You do not need to be resident of HK or Singapore to open accounts with local branches of HSBC or Standard chartered. Both banks offer global services which allow instantaneous transfers of funds between various jurisdictions and different currencies with reasonable echange rates (where it is allowed by law). This services are free of charge for Premiere customers in HSBC and
      corresponding customers in Standard chartered. Moreover, HSBC Premiere customers can open accounts throughout the world through their local relationship managers without actually traveling to the desired
      destinations. Unfortunately, there are limitations for American customers due to conditions imposed by US government. Neither HSBC nor Standard chartered will open brokerage accounts for Americans outside US.
      Judging from my conversations with international bankers, the situation may drastically change for Americans in 2013 after corresponding provisions of FAT CAT act will be enacted. In particular, I do not share Simon’s view that global banks with US presence will treat American customers any better than other offshore banks: in fact, they will have no choice as to accept US conditions and then most probably kick out all US customers from their offshore branches to reduce the cost of compliance.

      • Clue?

        But you still need proof of address (including utility bills), HK/Singapore ID, or a passport.

        Of course you can make transfers between banks – all banks offer this service. My point was don’t think HSBC or SCB are global platforms, where you can just walk down to an HSBC in any country and expect to withdraw or deposit money into your offshore account seamlessly.

        It doesn’t work like that. You may as well be walking into a completely different ‘brand’ of bank with regards to accessing your offshore HSBC account, as they are each treated more or less as stand-alone franchises, subject to individual regulatory requirements.

        You may be able to escape some transfer fees, as you say, if you maintain high enough balances – but this is a privilege like any other financial company offers; the more money you hand to them, the more so-called privileges they will offer.

        I’m just saying bare in mind having an offshore account in a so-called global bank, does not mean you will have exactly the same access (when back in your home country) to your funds in your offshore account in the way you would from a local home-grown bank. This kind of thinking is a common fallacy when people think about well-known, global banking brands.

  • Marquelle

    Thumbs downs and Dislike to the new links and widgets…..

  • Rosco

    Would you consider doing a Black Paper on Switzerland?

  • Paul

    I would also be interested in a Black Paper for Switzerland.

  • Realistic weight loss goal

    When you contact a bankruptcy lawyer, he helps you n more than one way. He first makes you aware of your own financial situation. He is the best person to decide whether you can file for bankruptcy or no. He will surely take out time to tell you about your rights and duties, the laws of bankruptcy of the state etc. Calculating your incomes and expenses, collecting all the information and evidence to prove your bankruptcy is all done by your bankruptcy lawyer. You can lie to anyone you want but not your doctor or your lawyer or else you will be in deep trouble.

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