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Background;

  • I am from the UK.
  • For the last 18 months and for the foreseeable future I am not likely to be based anywhere long enough to meet the requirements for tax residency. I think this is referred to as being a perpetual traveler.
  • I operate under my own company that is based in Estonia, but am not personally liable for income tax there.
  • My company trades in EUR and GBP, and my personal finances are all managed in Euros. I have an address that I use for personal mail in the UK (family), and one for business mail in Estonia.

I wish to open some sort of long term investment account (probably ETF), but am confused if my tax status, or lack thereof, will affect this.

Will I encounter any issues trying to open an investment account in the UK? For instance I'm not sure how easy it will be for my to prove my tax status since I'm currently not a resident anywhere.

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  • "I am not likely to be based anywhere long enough to meet the requirements for tax residency." For the purpose of tax avoidance?
    – RonJohn
    May 12, 2018 at 14:21
  • @RonJohn I'm not trying to avoid paying income tax, it's just a side affect of my situation. I am able to work remotely, so I spend a few months at a time in different countries around the world. If I spend long enough in one place to be deemed taxable there then I will gladly arrange that.
    – Jivings
    May 12, 2018 at 14:57
  • OK. I asked because your perpetual traveler link is almost exclusively about how to avoid paying taxes.
    – RonJohn
    May 12, 2018 at 15:10
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    @Jivings this is an old question, but becoming increasingly relevant for more and more people. If you settled with anything, please answer your own question and share your experiences.
    – Conic
    Apr 22, 2022 at 8:11
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    @Conic thanks for the nudge, added an answer
    – Jivings
    Apr 22, 2022 at 8:32

3 Answers 3

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Answering my own question and adding some clarifications based on what I've learned in the last 4 years.

  • I still have ongoing tax-residency in the UK, as I generally don't spend long enough anywhere else to trigger non-domicile status, or to trigger tax-residence in another country.

  • It's essentially impossible to open an investment account in a country if you are not tax-resident there.

    For example, I have a German bank account, but they wont let me use their investment accounts without proving I have tax-residency in Germany.

  • There are mechanisms to move your tax-residency to another country that are affordable, and they are becoming easier as remote work becomes more popular.

    In 2021 I investigated one of the popular ones - the Portuguese Non-habitual Resident scheme, but I decided it wasn't worth it for me as it was too complicated and not enough benefit.

    However, there are now a few startups trying to make the process easier (1) so it might be worth investigating it again.

So my solution right now is to move my €s back to £s for the purpose of investing. Not ideal for me but the easiest solution.

If anyone has anything else they can add then please answer!

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You should open your investment account where it is most convenient to you while the brokerage/bank provides least friction. Usually, that would be where you are a tax resident.

For the last 18 months and for the foreseeable future I am not likely to be based anywhere long enough to meet the requirements for tax residency. I think this is referred to as being a perpetual traveler.

It is very likely that you're still a UK resident for tax purposes. If you do not establish residency anywhere and are successfully able to defend that position, you're likely to be taxed as non-resident in each jurisdiction you pass through which is likely to be a disadvantage. If you want to be compliant with all the laws and regulations that is.

I operate under my own company that is based in Estonia, but am not personally liable for income tax there.

How sure are you about that? You may not be a resident there, but as a non-resident you're still likely to be on the hook for income derived from Estonian sources (including the income you receive from your corporation).

I wish to open some sort of long term investment account (probably ETF), but am confused if my tax status, or lack thereof, will affect this. Will I encounter any issues trying to open an investment account in the UK? For instance I'm not sure how easy it will be for my to prove my tax status since I'm currently not a resident anywhere.

If you can't prove your tax residency status, you risk your account application to be rejected. If you open an account as non-resident and the bank/brokerage firm accept your application, you're likely to be hit with much higher mandatory withholding than you would have been as a tax resident. Since you're claiming to be non-resident anywhere, tax treaties are of no use to you, which is unfortunate since tax treaties are specifically designed to help in situations like this.

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  • Nice answer. I think back when I asked this question I was more optimistic about my tax residency. Now I consider myself to still be resident in my home country (UK), although that comes with it's own problems when filing taxes or similar things where you are generally required to have a fixed permanent address.
    – Jivings
    Apr 23, 2022 at 9:08
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The natural thing to do is to locate your investments where your bank account(s) are.

Since that is apparently the EU, then it would make sense to invest in an EU country. If I had my bank account in Estonia, then I would invest in Estonia. An easy way to invest in any country is to buy bonds issued by entities in that country.

If you a high-risk / high-reward type of investor, one possibility is to speculate in real estate options. This type of speculation can be done in any country where you are able to legally own property.

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