Best Country for Trading (Tax efficiency)

[luisHK]

We're totally off topic here, I guess the interest rate is paid on local currency, it still sound a bit high, the central bank policy rate is 12%, although with such high rates maybe it goes much higher when you block the money 1 to 5 years ?

http://www.cbrates.com/

Anyway if it's in local currency you get both counterparty risks and forex risks. How easy it is to open an account in Mongolia and wire money in and out of the country ?
If there are Mongolia Tughrik futures available on a more developed country futures exchange one can pick up the central bank high rate through those futures while reducing the counterparty risks and the practical issues of depositing money in Mongolian banks, but not sure where you will find those futures , if at all. It works for some of the high interest countries, like Russia.

Reminds me of a post here about USD accounts in Cambodia paying 7%.
It's not necessarily a bad choice to park some money there, it's not like the major banks in Cambodia bankrupt monthly, but you'd better do some research on how easy to move the money in and out of there, or to get it back for your heirs .

 

[jk90029]

Reminds me of a post here about USD accounts in Cambodia paying 7%.
It's not necessarily a bad choice to park some money there, it's not like the major banks in Cambodia bankrupt monthly, but you'd better do some research on how easy to move the money in and out of there, or to get it back for your heirs .

How about a NEW proposed investment plan as below?

Select n=10 or 20 countries with high CB rate, to invest national bond of1/n equally so that in worst case if bankrupcy of one country, your asset will be gone for the country(actually TO the country)

 

[Hittfeld]

From having gone OFF TOPIC to now going FURTHER OFF TOPIC ........

 

[jk90029]

From having gone OFF TOPIC to now going FURTHER OFF TOPIC ........

To find a best country as in the main title,

1) Low tax rate (transaction tax + income tax)
2) Low commission broker

should be a topic, I agree.

******************************

It is easy to find a broker charging 10 times than the other broker for the commission.
Also some county charges twice tax than the other country.

For a hypothetical example, let we have a trading logic of annual 30% return rate with a starting seed of 100K.

1) With expense rate of annual 20%, then the difference of 10% is his bringing-home rate so that after 50 years his wealth is expected to be
100*1.1^50 = 11739.09K

2) In some best coutry with expense of 10% for tax and commission, the difference is 20% / After 50 years, 100*1.2^50 = 910043.8

In conclusion, you gain 910043-11739 = 898304K just because you found a "best country" and also best broker even with SAME trading logic.
It is A LOT CHEAPER to fly to county of 2) and buying a house there.
Calculate yourself for the country with income tax bracket of 40%.

Simply most ETers have to make (commonly work for)
A) A GOOD (highly profitable) trading logic before expense(comm+tax)
B) Find a best country (as in title), to save tax+comm for a GOOD disposable (bringing home) income (return)

 

[jk90029]

OR, suppose you have a own trading logic with annual 40%.

1) some broker may charge you annual 5% for the seed amount in Jan first.
2) some country charges 25% of the annual profit, which is annual 10% for the Jan seed.

In this case, return rate after the expense(tax+comm) is annual 25% compounded.

 

[i am nobody]

From having gone OFF TOPIC to now going FURTHER OFF TOPIC ........

We should open a special thread only for JK90029, called "suppose that..."
There he can make all imaginable and non imaginable calculations to see what would happen if...


He can even make calculations from what Adam and Eve have missed already in compounded interest if they would still live. They would probably be the richest on earth, as they are here the longest time.
OMG, I get already infected by JK90029's philosophy!

 

[jk90029]

Here is income tax rates by country, for comparison
https://en.wikipedia.org/wiki/List_of_countries_by_tax_rates

Also for commission in US brokers, refer
https://en.wikipedia.org/wiki/Comparison_of_online_brokerages_in_the_United_States

How about brokerage of other country than US?

 

[Hittfeld]

Here is income tax rates by country, for comparison
https://en.wikipedia.org/wiki/List_of_countries_by_tax_rates

Also for commission in US brokers, refer
https://en.wikipedia.org/wiki/Comparison_of_online_brokerages_in_the_United_States

How about brokerage of other country than US?

Unfortunately the list of US brokers doesn`t explain which ones accept non-resident-aliens as customers.
Also the comparison of tax rates is misleading at best: No mention of the special rates for traders and regulations of capital gains.

 

[jk90029]

Unfortunately the list of US brokers doesn`t explain which ones accept non-resident-aliens as customers.
Also the comparison of tax rates is misleading at best: No mention of the special rates for traders and regulations of capital gains.

I agree it may mislead. But what else site gives better idea, for the OP question?
If there is some, please tell us now.(Appreciated)

Also some country charges (additional) stamp tax (transaction tax) like UK. The above website does NOT show it.

For the "which ones accept non-resident-aliens as customers", if there is a cheap tax and cheap comm in some country, then fly there to save several 100K's for tax+comm in the NEW country during your entire life(like 50 years) of compounding.
There is explanation (for "several 100K's") using some numeric assumption above.

 

[Hittfeld]

........
if there is a cheap tax and cheap comm in some country, then fly there to save several 100K's for tax+comm in the NEW country during your entire life(like 50 years) of compounding.
There is explanation (for "several 100K's") using some numeric assumption above.

You mean, just board a plane and go to the US, Switzerland, Bahamas ...... to live and trade and let the stash compound????

Ever heard of "immigration laws"? But this aside, you need to know, where income from trading and capital gains is taxed favourably. Taxation in Sweden or Netherlands is high - but trading is taxed friendly.