Pay 7% Tax Here For Life (and Free Citizenship)

Summary

Uruguay, often dubbed the Switzerland of South America, offers a unique tax opportunity for foreigners seeking a low tax life while enjoying free citizenship. New residents can take advantage of 0% tax on foreign income for 11 years, eventually transitioning to just a 12% rate. Alternatively, a lifetime 7% tax path is available. Uruguay, known for its safety and slow-paced lifestyle, provides accessible immigration options, making it an ideal choice for global citizens seeking tax efficiency and quality of life. This video explores these tax options and the benefits of living in Uruguay.

Highlights

• Discover Uruguay's unique offer of a 7% lifetime tax rate for expatriates. 🤑
• Utilize 0% tax on foreign income for the first 11 years of residency. 🔍
• Obtain citizenship in as little as 3 years for families, and 5 years for singles. ✈️
• Enjoy the safety and tranquility of Uruguay, a neutral and secure country. 🌳
• Explore options for relocating your company to a more tax-efficient jurisdiction. 🌎
• Benefit from lower living costs and high life quality compared to other nations. 🏡

Key Takeaways

• Uruguay offers an attractive 7% lifetime tax rate for foreign nationals. 🇺🇾
• Enjoy zero tax on foreign income for the first 11 years of residency. 🤑
• Get free citizenship within 3 to 5 years while benefiting from low taxes. 🗺️
• Experience the Swiss-like banking infrastructure and safety of Uruguay. 🏦
• Move your company to a tax-friendly jurisdiction while living in Uruguay. 💼

Overview

Uruguay emerges as a haven for individuals seeking a low-tax lifestyle and easy paths to citizenship. With its options to pay either a lifetime tax rate of 7% or enjoy a decade of tax-free living followed by moderate taxes, it appeals to both families and singles. The country's high safety standards, coupled with a Swiss-like banking system, make it a compelling choice for expatriates.

Living in Uruguay not only means significant tax savings but also a relaxed, slower-paced life that's particularly attractive to families. While you can bank in Uruguay, it's advisable to keep your business in globally recognized, tax-efficient jurisdictions, optimizing for the best financial outcomes. The passport obtained from Uruguay is well-respected internationally, enhancing travel freedom.

The approach in Uruguay highlights a growing trend where countries offer enticing tax deals to attract wealthy global citizens. By integrating in Uruguay, individuals can enjoy increased disposable income, invest more in their ventures, and secure a stable, second passport. Such strategies greatly benefit those leaving behind high-tax countries, providing both financial freedom and global mobility.

Chapters

• 00:00 - 00:30: Intro to Uruguay's Tax System This chapter introduces Uruguay's tax system, highlighting its unique offering of a 7% lifetime tax rate. It suggests that unlike other countries where politicians and policies change, causing fluctuations in tax rates, Uruguay offers stability and attractiveness with its low tax rate. The country is compared to Canada in terms of safety and amenities, making it a globally appealing destination. The chapter sets the stage for exploring how to benefit from Uruguay’s tax offerings.
• 00:30 - 01:30: Uruguay's 11-Year Tax Exemption Uruguay in South America is offering a significant tax deal, serving as a refuge from global instability. Often referred to as the 'Switzerland of South America' due to its strong banking sector, Uruguay provides a highly favorable tax system for foreigners. One of the options available includes a 0% tax rate on all foreign income.
• 01:30 - 02:30: Citizenship and Residency The chapter discusses the benefits and conditions of gaining residency and possibly citizenship in Uruguay. It highlights a tax incentive where foreign income is not taxed for the first year of residence and extends up to 10 more years, totaling 11 years. It also mentions the requirement of spending a significant amount of time in Uruguay and integrating into the country to qualify for citizenship.
• 02:30 - 03:30: Uruguay's Passport and Travel Benefits Uruguay offers a practical timeline for acquiring citizenship—3 years for nuclear families and 5 years for single individuals. Although Argentina and Peru boast a shorter 2-year period, they present other complexities. For families, committing to a life in Uruguay can lead to rapid citizenship within 3 years, and for singles, within 5 years, both of which fall well below the 11-year deadline. This timeline provides a flexible pathway even if unforeseen delays occur.
• 03:30 - 04:30: 7% Lifetime Tax Option The chapter discusses the benefits of obtaining a second passport, particularly a Uruguayan one, which allows for tax-free travel and living in Europe and South America. It highlights the passport's strong reputation, minimal visa requirements for global travel, and its neutrality as a secondary citizenship option.
• 04:30 - 06:30: Uruguay's Local Tax and Business Setup The chapter discusses the tax advantages of establishing a business in Uruguay. Initially, there's a 12% tax rate after 11 years, but there are options to negotiate for a lower 7% tax rate for life by paying immediately. The chapter also compares Uruguay’s tax setup with other jurisdictions like the Cayman Islands, where companies can operate with no tax for extended periods under certain agreements.
• 06:30 - 08:30: Relocation Options to Uruguay The chapter explores various relocation options to Uruguay, with a focus on the tax implications for foreigners. It clarifies that while foreign income might be taxed differently, any job you take up or business you start in Uruguay is subject to local taxation. This includes salaries from jobs and profits from businesses, much like any Uruguayan enterprise. Uruguay aims to stay competitive by implementing its tax laws thoughtfully for newcomers.
• 08:30 - 10:30: Financial Benefits of Moving to Uruguay This chapter discusses the financial advantages of relocating to Uruguay, particularly in terms of tax benefits. It highlights a shift in sentiment where fewer people see moving to the US as attractive due to alternative countries offering significant tax reductions. Uruguay, among other countries, is portrayed as welcoming and advantageous for individuals looking to legally minimize their tax obligations.
• 10:30 - 12:30: Uruguay's Safety and Cost of Living The chapter discusses the advantages of living in Uruguay, focusing on its positive aspects like not taxing foreign income for the first 11 years, which encourages investment and employment in the country. The author shares a personal account of renouncing US citizenship, highlighting the differences in tax obligations between the US and Uruguay, and explaining how living abroad can lead to significant financial benefits.
• 12:30 - 14:00: Conclusion and Personal Views The chapter discusses the tax benefits of owning rental properties in the United States compared to Uruguay. The speaker highlights an exemption on foreign income and explains that living in Uruguay does not necessarily mean that one should establish their company there, especially if the income is from foreign sources. The key point is to take advantage of the tax incentives available by carefully considering the location of the business operations.

Pay 7% Tax Here For Life (and Free Citizenship) Transcription

• 00:00 - 00:30 no matter which politicians you put in power in your country chances are you'll never be able to pay a tax rate as low as 7% for the rest of your life but there's one developed country they're offering just that and today I'm going to tell you how you can claim this 7% lifetime tax [Music] rate we told you not that long ago that this country is pretty much on par with Canada it's just a safe has a lot of the same amenities and while it's a somewhat
• 00:30 - 01:00 boring place they're offering you the tax deal of the century Uruguay in South America is a place where you can go not only to get away from the global chaos if you think there's a war coming up you're pretty much out of the crosshairs and it's been called the Switzerland of South America not only because it has a more robust banking infrastructure than most places in South America but because it's a place that foreigners can go and take advantage of a very favorable tax system they've got two options the first offer is 0% tax on All Foreign income
• 01:00 - 01:30 that means your foreign business that means your foreign investments they don't want to be paid we're not going to bother you don't pay us anything that offer is for your first year of residence and then for 10 more so you basically add it up to about 11 years you pay no tax on any foreign income now what's interesting about Uruguay is that while you do need to spend the majority of your time there and you do need to integrate with the country to get citizenship you can get citizenship in
• 01:30 - 02:00 as little as 3 years if you're going as a nuclear family or 5 years if you going as a single person so those are pretty reasonable timelines for citizenship I mean you do have Argentina and Peru at two years but they have their own uh weirdnesses about them so three years if you're a family pretty fast timeline to get citizenship if you're going to substantially commit to live in Uruguay 5 years if you're single obviously both of those are well within the 11-year time frame so even if your application drags out or something happens you can
• 02:00 - 02:30 tax-free get a top quality second passport that allows you to with an excellent reputation travel all over Europe obviously have access to live anywhere in uh South America and travel all over South America well respected really all around the world you need visas to go to very few countries as a Uruguayan the US and Canada being two of the big ones you can go to most other places in the world and again it's a pretty uh neutral second passport to have that's the first option no taxes
• 02:30 - 03:00 for your first 11 years then you pay 12% after that so you're still getting a deal you can also just come right in and say hey uh I'll just pay you right away but I want a lower rate that's where the 7% rate comes in for life now there's various countries and jurisdictions around the world where you can have a deal with them for example in the Cayman Islands for example you can set up a company get a certificate and you're going to have no tax for a very long time this deal is 7% tax uh for your
• 03:00 - 03:30 lifetime so that's on various sources of foreign income that's important to know because I think people get confused by this sometimes if you go to Uruguay and get a job for example you're going to pay tax on that salary in Uruguay if you go to Uruguay and you start a store and you sell uh fruit in your store you're going to pay tax on the profits just as any other Corporation in Uruguay does what Uruguay is saying Hey listen we may tax our own citizens the people have always lived there but we realize we have to be comp comptitive probably your
• 03:30 - 04:00 country doesn't believe the same does the US think that are they attracting people with low taxes no they're attracting people with a decades old Mantra of We're the best and fewer and fewer and fewer people believe it I see it all over the world people all over the world tell me I don't want to move to the us anymore I've got a few bucks now I'm doing fine right here so a country like Uruguay as with the dozens of other countries that we've helped our clients move to to legally reduce their taxes by 80 90 or 100% they're rolling at the red carpet we don't need your
• 04:00 - 04:30 money right now come you you'll shop at our stores you'll eat in our restaurants you'll create employment for people that way maybe you'll buy a property uh maybe you'll invest other money in the country we don't want a piece of your foreign income at least not for the first 11 years but if you make money in the country pretty much anyone's going to tax that right we've talked about how I gave up US citizenship I don't spend any time in the US I no longer a US person as defined uh by the US government and the IRS that does not mean if I went and
• 04:30 - 05:00 bought some rental properties in the United States that I wouldn't have to pay tax the same way anyone else did on those rental properties and that applies to Uruguay so we're talking about an exemption on foreign income or if you want the 7% rate you pay that 7% for the rest of your life now this brings up an important point and that is that just because you're living in Uruguay doesn't mean you want to have your company there in fact because we're talking about foreign sources of income we don't want to have our company there and on top of
• 05:00 - 05:30 that if you follow our philosophy go where you're treated best you take each part of your life and you set up shop in the best place for that part of your life so as a place to live if you're a family for example and I think this is mostly for families or at least married couples if you're a family you go to Uruguay the pace of life is slower people are Kinder uh everything just is a bit more relaxed you're far out of the way people leave you alone it's not the most extravagant life most of the year
• 05:30 - 06:00 but you have a nice peaceful life in a neutral very safe country what you're also getting is that zero and then 12 or 7% per lifetime tax rate but your company let's say you live in the UK you don't want to keep your company in the UK because the UK is going to keep taxing your UK limited company even when you leave you're not using the roads and bridges why would you pay anymore you're leaving because you're tired of paying so much whether it's the UK Australia Canada us wherever so you want to move your company or if you're starting a new
• 06:00 - 06:30 company you want to start it somewhere else but Uruguay is not the best place to start a company it's not the most Uber efficient it's not the most Global so unless you're dealing only with uruguayans most people won't understand it you want to set your company up somewhere else so you don't want to have your company set up in a high tax Legacy brand country you want to have it set up in the AFF forementioned Cayman Islands or uh in Hong Kong or in the British Virgin Islands uh I would have said Dubai but they now have their 9% tax on most kind of companies there's a number
• 06:30 - 07:00 of different we work with generally about 14 or 15 different jurisdictions there's three or four that are that are best for the majority of people and there's about 10 that could be good for for Niche situations so you know those are the number of jurisdictions that we work with that are tax friendly for somebody it might be Switzerland there's there's rare cases where uh Switzerland could be a good place to have your company but you don't want to have your company and it wouldn't be to your benefit to have the company in Uruguay so keep in mind when they say zero tax for the first 11 years or 7% tax for the
• 07:00 - 07:30 rest of your life that's just on the money that you're getting personally and so uh Uruguay is going to have other rules in terms of how it interfaces with your company that's a whole you know separate conversation but bottom line if you structure it right you get it down to 7% but you got to keep that company somewhere else people make the mistake of trying to take their entire life and move it to one place don't move your company to Uruguay I think you can move some banking to uru I don't think it's unsafe I think the banking there is a little bit better if you actually live there I've looked at it personally and
• 07:30 - 08:00 just it's a little bit more focused on you know being there to to run the process it's not an account that I would rush to open if I didn't plan to have any connection with Uruguay you know compared to like Singapore for example right so you could Bank personally in Singapore have your company the British Virgin Islands you know have the the British Virgin Islands bank account in you know Hong Kong and then you're living in Uruguay you're bringing your money to live in Uruguay but you're keeping a lot of the rest of your money offshore either way they're going to tax
• 08:00 - 08:30 you at those rates now you might be asking how do I move to Uruguay they've got a couple of different options here's my colleague on The Nomad capitalist R&D channel to tell you how you can get a resident's permit to move there in the first place in addition to the great tax benefits that Mr Henderson already explained in the case of Uruguay from an immigration perspective the country is also extremely friendly so basically there are different options through which a person a foreign person can apply to obtain residence in Uruguay these include options that involve
• 08:30 - 09:00 making Investments forming companies purchasing real estate but today I want to focus on a couple of options that our clients mainly focus on which are the most I would say readily available to 90 plus% of the people interested in relocating to uguay number one is the Uruguayan digital Nomad Visa so if you have a remote job you are doing things from your laptop you digital nomading definitely this Visa is for you in addition to that if you're a pensioner you could potentially show $1,500 worth
• 09:00 - 09:30 of income and in addition to that make an investment of $100,000 in determined assets and lastly I would say the number one category the one that seems to be the winner for most of our clients is simply a passive income Visa where you show you have $1,500 worth of income it does have to be passive so think dividends interest royalties and things of that nature and if you manage to prove this you will automatically get a residence permit in Uruguay now the interesting thing is it is quite easy and quite Swift to
• 09:30 - 10:00 transfer and turn that temporary residence permit into a permanent residence permit with the only catch that you have to remain in Uruguay during the entire time of your application if you don't want it to be paused and then have to then uh return to the country to have it resume and then you know take it from there once more so Uruguay great for taxes easy for immigration so let's say you choose the 7% route if you're living in any of the high tax Legacy brand countries US Canada Australia uh UK Western Europe
• 10:00 - 10:30 let's say you're paying 40% that's probably generous in some of these places if you can take that down to 7% That's $330,000 on every million dollars you make so let's say you make a million dollars you take that $330,000 you set that aside if you invest that back into your own business or back into more Bitcoin that you invest in the side or whatever you the sky could be the limit of that what if you just put it into the S&P 500 after just a decade you're going to have millions upon Millions upon millions of dollars by by one metric about $7 million extra that you can do
• 10:30 - 11:00 something with if not more because you invested it back into your business we've had clients over the years that said uh they tax me too much before I can even go to buy more stuff for my business on top of that Uruguay is less expensive so compared to London it's 40% less expensive okay London's an expensive place 23% less than Kansas City and so you're getting more bang for your buck again you're getting more safety than London or probably also Kansas City you're you know far away and
• 11:00 - 11:30 you're diversifying into a second passport so theoretically this could be something where let's take let's say you take the 0% route you could choose to live there for 11 years get second passports in a neutral country for your whole family for basically free literally free on the tax side but basically free in terms of you're just paying with your time it's an adventure for the family uh and you can decide after that hey I don't want to live here anymore I'm going to go back to my country I'm going go to a different country with a taxfree regime once you have the Uruguay citizenship America opens up more for you so other countries
• 11:30 - 12:00 could be uh you know easy to move to if you wanted to go to Chile if you wanted to go to Paraguay who knows that Malay as an Argentina that could be livable in the future it's livable now but it could be livable from a tax perspective I mean who knows 11 years is a long time but you could put an extra 7 million bucks in your pocket if not more just by doing that so lower cost of living much lower tax safer place again when we compare to Uruguay in terms of safety and the global peace and all those different indexes against Canada came up pretty close but
• 12:00 - 12:30 we're seeing Argentina nip at even Canada's heels for some of the safest cities in the Americas Uruguay is uh is right up there quite frankly there's some really beautiful places that you can go I think that my idea would be it's more for someone who wants to go and buy a property that would be my focus for a number of reasons but get the residents permit buy a property which can help you do that get on the tax deal of your choice I think deciding do I want to you know live here more
• 12:30 - 13:00 than 11 years my inclination probably would be to take the 0% for 11 years who knows where you want to be or where you have to be at 11 years take the lower right now put some of that money aside you can invest it that'll pay the extra 5% on the back end but that's a decision you have to make uh for your own finances and so very interesting place that for me tis a lot of boxes now I personally don't live there because further to to travel to other places that I need to go I'm constantly on the go it's harder to get around if you're someone who's constantly traveling
• 13:00 - 13:30 internationally to all the different parts of the world yeah it's going to be a more difficult place to be uh also you know I like some excitement right I'm a little bit too uh dopamine focused Perhaps it is not full of that um but you do have much more organic food as well so whole slew of benefits again particularly for a family keep more of your own money get a second passport Uruguay is one option we're seeing more and more tax friendly options in Latin America if you want us to talk about those leave a comment below Latin America we'll talk more about that and
• 13:30 - 14:00 this is the kind of stuff that you learn about at Nomad cist live uh it's our 4-day annual event we've got people coming from various Latin American countries in the upcoming year you're going to hear about tax friendly countries you never knew existed you're going to hear about passport programs you probably never heard about so if you're not our client uh then make sure you're at Nomad countless live you can learn more about it at nomad.com [Music]