The most important thing to understand is that these services don't have your interest in mind and they are out of country, so they can offer you bad advice with no liability on their end (vs. say a CPA). Your problem is not setting up a "free zone company" or whatever that means but getting your current obligations to drop. You do that by visiting your local tax office and telling them you are off the country. It doesn't mean your liabilities disappear overnight.
Your biggest liability (tax-wise) is going to come from your revenue source. That's also where you should be careful. Next, is the country of your passport (because they got you by the **). Everybody else matter very little which is why you should steer away from Dubai, HK, off-shore, etc.. until you understand the nuances of your situation.
I just read the citations you posted. Do you make enough for it to be worth it?
From one of the citations
> The average digital nomad pays $64.76 per day in taxes they do not have to pay - that is over $23.000 per year. Imagine what you could do with all this money. Let us do the paperwork, while you travel the world*
$23K isn’t nothing. But I saved half that much just by moving from a relative low tax cost state (GA) to a state tax free state (FL).
If I lived in a state with higher state taxes and higher cost of living, I would have saved even more.
And anything you do, the first step is giving up your US citizenship since the US taxes worldwide income.
But then you need to have citizenship somewhere else or become “stateless”. From the few countries I looked at, it’s a 3-5 year process.
The US has a relatively strong passport (ranked 9th in the world). You would also have to give that up.
Cypress and Paraguay have strong passports (brought up in your second site).
Edit:
I see you aren’t a US resident. None of what I said applies to you. I’ll keep it up anyway for anyone else thinking about something similar.
Answer to your first question: yes, even if it means paying such companies and, if necessary, additional tax lawyers, as income is taxed rather brutally in my home country.
Thanks for your input though, this is a valid concern and important to consider: amount of potential tax saved and citizenship.
Advice to all US citizens considering this: take a look at the power of passports, it can go a long way. Here is one of many sources to check: https://www.passportindex.org/byRank.php
An LLC is a pass-through entity, which means you don't pay corporate tax but you pay personal tax on all profits. With an LLC, you can't pay yourself with dividends like a normal company, so it won't count as "foreign sourced income". This means that it's generally a bad solution for paying less tax, as personal tax rates are much higher than corporate.
You should look for countries with low corporate tax that don't tax on dividends.
I think you misunderstand how personal income is taxed in Thailand. Take a look at what the Revenue Department has to say about this: https://www.rd.go.th/english/6045.html
I quote: "A resident of Thailand is liable to pay tax on income from sources in Thailand as well as on the portion of income from foreign sources brought into Thailand" (resident = stay >180 days per calendar year).
If the "income from foreign sources", which should include income from a foreign company, is not "brought into Thailand", it should not count towards taxable income, if I understand this correctly.
Do you have a different interpretation which would make income from a foreign company with no clients in Thailand fully taxable and how would you explain that?
I don’t understand what you are asking. How are you going to live in Thailand without bringing income into Thailand?
The quote from the revenue department is clear - you will need to pay personal income tax in Thailand since you’re resident there. “Sourced” most of the time means where you do the work, which will presumably be in Thailand for you.
If you set up a company, you will need to pay both corporate tax (wherever you incorporate), plus personal tax on the dividends that you pay yourself with in Thailand.
You originally asked about the LLC, which was why I mentioned it specifically. With an LLC, you would be fully taxed in Thailand at the personal tax rate, because that’s how LLCs work (you don’t pay corporate tax with an LLC).
My advice would be to look into Cyprus and their non-dom program. You can get tax residency there with only spending 60 days per year. Create a Cyprus LTD and your tax rate would be 12.5% + 2.65% for social security. You don’t need to pay personal tax on dividends.
As far as I can tell these service are essentially the same as not reporting an income in a roundabout way - illegal but you will likely get away with it because how will the tax authorities of your country know.
Do these services provide you with legal representation towards your home country? My guess is probably not.
Yes, I am moving there, but I do not want to open a company just yet. I might do so in the future to ensure I pay enough taxes for meeting the requirements to become a citizen, but to grow my funds and because I get nothing in return for paying taxes there for now, I would like to keep my business in a different country.
Also, I am probably going to consult a tax lawyer there, but it still does not hurt to ask others about there experience I think.
I think there are a bunch of things about tax you don't quite understand yet - I recommend you find a financial planner who can help you navigate this.
Firstly, it's trivial for a business not to pay tax; simply don't make a profit. (Since you can simply assign any excess to yourself as salary.)
Of course you then gave a personal income tax question; and that has its own complications.
Staying with business; and assuming it makes a profit, you then have choices regarding where to register the company. At the one extreme you have zero-tax places (Isle of Man, Jersey et al) but they come with fixed high annual costs. (Not a "tax" - just payments for services.) Your choice is typically one of these, or the place you live, or the country of your passport.
Things like banking play a role. When you can't visit your bank it gets harder to resolve issues (like when they freeze the account because of money-laundering concerns.)
All this to say, Tax planning is complicated. And if you insist on playing games it gets very complicated. The internet I'd not the place to get advice. You need to speak to a professional, or more likely a professional in all the places that matter. If you are a US passport holder even more so.
You are absolutely right and of course I will pay a Thai accountant to help me with this.
I just wanted to reach out to my fellow HN users beforehand to get some insight into other people's experiences and this is one of the best places to do that IMHO as I have already read some very wise comments on this beautiful orange website which makes me want to ask here instead of some sub-reddit ;-)
Luckily I am not a US citizen (or Eritrean) so it should be a bit easier for me (fingers crossed as I type this).
Though all the digital nomads I met in Thailand kept their company / legal structure in their home country. Setting up shop in a new country - in particular in a slightly dodgy one - may not be worth the trouble to save some taxes on a modest income.
Exactly, which is a good reason for me to think about setting up a US LLC (also access to superior banking and the country that has platforms like Stripe to make my life easier).
Say what you will about the US, but to this day it remains one of the best countries in which to start a business, as far as I can tell from years of personal experience (in other countries) and research.
It's 2025 and your depending on your country they might be getting quite a bit of information (bank accounts, brokerage account, insurances transactions, Beneficial Ownership, etc...) Lookup CRS.
But do any of these setups help you with that? Ie. get a tax free company that is not under your name but under your control. And get an international bank account for that company plus an international debit card.
Plus you would need customers who are cool with paying you through an entity like that.
Not only that but the system is guarded through the banks. Even if you open a bank account for your company, you have to fill beneficial ownership rules for that bank account. So they might end up linking you to it that way.
The problem with this is that they usually have no idea about international set-ups and many of them are just interested in making money (unfortunately a lot of people are, because money is a very important aspect of our lives).
Same, but residence probably always require a time period. I think it highly depends on your actual citizenship and what tax agreements they have with Thailand etc.
I am not a tax resident in my home country anymore, since I already migrated to a different country (UAE). I am also not trying to avoid becoming a tax resident of Thailand, but as the law seems to state currently foreign sourced income is not being taxed there necessarily.
Sounds like the "flag theory", I heard that a few times during my research (the quoted services also cite this).
I think this is not so easy though, depending on the individual circumstances. My home country for example might want proof of my tax resident status of the past years if I ever decide to move there again, which will be difficult, if I have not been a tax resident anywhere. Of course this is easy when you reach a certain amount of wealth, but unfortunatelly I am not there yet and might need some time (if ever) to get there.
I understand at least having a dual residency as a back up plan and that’s our plan with establishing residency in Costa Rica before retirement and keeping our by then paid off condo in the US.
It's optimal because you get left the hell alone. Governments do not know what they citizens do if they are neither living in the country nor having their money in the country. Governments do not know what their residents do, if they are neither citizens nor have their money in the country. Governments do not care what foreigners do with their money in their country if they are neither citizens nor residents.
A simple example would be someone who does not have US citizenship (or Eritrea) and is able to move their tax residency to a second country that has very low or no income tax (e.g. UAE).
There are other countries (e.g. Cyprus) that do not require you to stay for 180 days or more to gain residency, so I think this is the kind of setup he is talking about.
The last piece of the puzzle would be international bank accounts, which gets easier the more money you have (e.g. HSBC Expat, which requires 50k USD to set up).
If you're thinking in these terms, then the advice isn't really for you. You are probably better served by staying where you are, paying the tributes you duly owe and obeying the commands of your government.
The real world application of this advice is that you don't ask for permission, and involve governments as little as possible in your life. This of course means that your source of income has to be adapted to this, usually meaning having your own LLC.
Right because the government doesn’t do anything for its citizens and no one should pay taxes anywhere.
Unless you can provid all of the infrastructure for yourself and insure your property rights are secured from people just taking them.
You realize you are going to have to “obey the laws” of whatever country you live in?
The only way you don’t involve some government in your life is to either live in on a boat or to live off the land in the woods somewhere
You know that LLC is also a legal construct you need a government to enforce. Do you plan to get a passport? Do you plan to be “stateless”? Plan on registering for the countries health care system?
So does the title of thread automagically mean there is some method to avoid being ruled by some government except living in the woods or the middle of the ocean?
I understand that you're trying to make a point, but there's no need to provoke him like that. Everyone has to make their own decisions based on their own circumstances, and pushing them in a certain direction doesn't really help. Let's keep it constructive please.
@scarface_74: My goal is to avoid a high tax that I am used to from my home country without getting (enough) in return in my opinion. I would rather take my chances and prepare for retirement etc myself than leave it to a government.
I never want to be "stateless", quite the opposite! I would like to collect some citizenships to have more freedom, because even with a strong rank other passports still give you access to different areas of the world.
I am fine with paying taxes if the rate seems fair (e.g. not 50% of my income if I am not a multi-millionaire) and if I get a good value for it. Yes, security is one of those values, but depending on your situation, a government may or may not be able to provide that (in my case, my home country was not able to do so, another good reason to believe that my tax is not being used well enough to achieve that goal).
> I never want to be "stateless", quite the opposite! I would like to collect some citizenships to have more freedom, because even with a strong rank other passports still give you access to different areas of the world.
The citizenship part is the easiest part. You can never loose your citizenship, and it is in no way tied to your residency or your income/money.
People who dream about migration almost always and erroneously believe that this means that they have to get on a path to new citizenship. But you shouldn't worry about this, unless you are very anxious to be able to vote in elections.
Then there is US citizenship, which is actually tied to your income, if I am not mistaken.
A citizenship for me would only bring the following advantages
- be able to live in a country without the hassle of renewing visas
- Having a second citizenship if the (political) situation in my home country goes sideways
I am not interested in voting because I do not believe that I can make a difference. I have done so for decades and things have only got worse in my country, so I have lost hope in the political process.
> The citizenship part is the easiest part. You can never loose your citizenship, and it is in no way tied to your residency or your income/money.
If you are a citizen of a country that taxes your worldwide income - like the US it does affect your income. You want to be a citizen somewhere and not end up “stateless”
Thats much easier - finding countries with lower taxation, citizenship via residency and stable economies. Your initial ask was way more complicated.
Look for countries where you just have to prove stable income, or do some type of investment in the country and then depending on the country it takes between 3-8 years to qualify for citizenship after you become a legal resident
The most important thing to understand is that these services don't have your interest in mind and they are out of country, so they can offer you bad advice with no liability on their end (vs. say a CPA). Your problem is not setting up a "free zone company" or whatever that means but getting your current obligations to drop. You do that by visiting your local tax office and telling them you are off the country. It doesn't mean your liabilities disappear overnight.
Your biggest liability (tax-wise) is going to come from your revenue source. That's also where you should be careful. Next, is the country of your passport (because they got you by the **). Everybody else matter very little which is why you should steer away from Dubai, HK, off-shore, etc.. until you understand the nuances of your situation.
Tax avoidance rather than evasion is what you’re after.
Avoid the need to pay in the first place instead of taking evasive action for payments demanded ;-)
Thank you for the correction, you are right, I am actually looking to avoid them ;-)
I just read the citations you posted. Do you make enough for it to be worth it?
From one of the citations
> The average digital nomad pays $64.76 per day in taxes they do not have to pay - that is over $23.000 per year. Imagine what you could do with all this money. Let us do the paperwork, while you travel the world*
$23K isn’t nothing. But I saved half that much just by moving from a relative low tax cost state (GA) to a state tax free state (FL).
If I lived in a state with higher state taxes and higher cost of living, I would have saved even more.
And anything you do, the first step is giving up your US citizenship since the US taxes worldwide income.
But then you need to have citizenship somewhere else or become “stateless”. From the few countries I looked at, it’s a 3-5 year process.
The US has a relatively strong passport (ranked 9th in the world). You would also have to give that up.
Cypress and Paraguay have strong passports (brought up in your second site).
Edit:
I see you aren’t a US resident. None of what I said applies to you. I’ll keep it up anyway for anyone else thinking about something similar.
Answer to your first question: yes, even if it means paying such companies and, if necessary, additional tax lawyers, as income is taxed rather brutally in my home country.
Thanks for your input though, this is a valid concern and important to consider: amount of potential tax saved and citizenship.
Advice to all US citizens considering this: take a look at the power of passports, it can go a long way. Here is one of many sources to check: https://www.passportindex.org/byRank.php
> And anything you do, the first step is giving up your US citizenship since the US taxes worldwide income.
But the foreign earned income credit can reduce your tax liability by up to around 100k in some cases.
An LLC is a pass-through entity, which means you don't pay corporate tax but you pay personal tax on all profits. With an LLC, you can't pay yourself with dividends like a normal company, so it won't count as "foreign sourced income". This means that it's generally a bad solution for paying less tax, as personal tax rates are much higher than corporate.
You should look for countries with low corporate tax that don't tax on dividends.
I think you misunderstand how personal income is taxed in Thailand. Take a look at what the Revenue Department has to say about this: https://www.rd.go.th/english/6045.html
I quote: "A resident of Thailand is liable to pay tax on income from sources in Thailand as well as on the portion of income from foreign sources brought into Thailand" (resident = stay >180 days per calendar year).
If the "income from foreign sources", which should include income from a foreign company, is not "brought into Thailand", it should not count towards taxable income, if I understand this correctly.
Do you have a different interpretation which would make income from a foreign company with no clients in Thailand fully taxable and how would you explain that?
I don’t understand what you are asking. How are you going to live in Thailand without bringing income into Thailand?
The quote from the revenue department is clear - you will need to pay personal income tax in Thailand since you’re resident there. “Sourced” most of the time means where you do the work, which will presumably be in Thailand for you.
If you set up a company, you will need to pay both corporate tax (wherever you incorporate), plus personal tax on the dividends that you pay yourself with in Thailand.
You originally asked about the LLC, which was why I mentioned it specifically. With an LLC, you would be fully taxed in Thailand at the personal tax rate, because that’s how LLCs work (you don’t pay corporate tax with an LLC).
My advice would be to look into Cyprus and their non-dom program. You can get tax residency there with only spending 60 days per year. Create a Cyprus LTD and your tax rate would be 12.5% + 2.65% for social security. You don’t need to pay personal tax on dividends.
As far as I can tell these service are essentially the same as not reporting an income in a roundabout way - illegal but you will likely get away with it because how will the tax authorities of your country know.
Do these services provide you with legal representation towards your home country? My guess is probably not.
That would be problematic, but isn't that still allowed under Thai tax law (see my answer here: https://news.ycombinator.com/item?id=43370402#43370656)?
These services do not provide legal representation as far as I know.
But are you moving your residency to Thailand? If so get a Thai accountant and a Thai company in your name.
Most countries except the US will not tax you if you move to another country.
Yes, I am moving there, but I do not want to open a company just yet. I might do so in the future to ensure I pay enough taxes for meeting the requirements to become a citizen, but to grow my funds and because I get nothing in return for paying taxes there for now, I would like to keep my business in a different country.
Also, I am probably going to consult a tax lawyer there, but it still does not hurt to ask others about there experience I think.
I think there are a bunch of things about tax you don't quite understand yet - I recommend you find a financial planner who can help you navigate this.
Firstly, it's trivial for a business not to pay tax; simply don't make a profit. (Since you can simply assign any excess to yourself as salary.)
Of course you then gave a personal income tax question; and that has its own complications.
Staying with business; and assuming it makes a profit, you then have choices regarding where to register the company. At the one extreme you have zero-tax places (Isle of Man, Jersey et al) but they come with fixed high annual costs. (Not a "tax" - just payments for services.) Your choice is typically one of these, or the place you live, or the country of your passport.
Things like banking play a role. When you can't visit your bank it gets harder to resolve issues (like when they freeze the account because of money-laundering concerns.)
All this to say, Tax planning is complicated. And if you insist on playing games it gets very complicated. The internet I'd not the place to get advice. You need to speak to a professional, or more likely a professional in all the places that matter. If you are a US passport holder even more so.
You are absolutely right and of course I will pay a Thai accountant to help me with this.
I just wanted to reach out to my fellow HN users beforehand to get some insight into other people's experiences and this is one of the best places to do that IMHO as I have already read some very wise comments on this beautiful orange website which makes me want to ask here instead of some sub-reddit ;-)
Luckily I am not a US citizen (or Eritrean) so it should be a bit easier for me (fingers crossed as I type this).
Though all the digital nomads I met in Thailand kept their company / legal structure in their home country. Setting up shop in a new country - in particular in a slightly dodgy one - may not be worth the trouble to save some taxes on a modest income.
Exactly, which is a good reason for me to think about setting up a US LLC (also access to superior banking and the country that has platforms like Stripe to make my life easier).
Say what you will about the US, but to this day it remains one of the best countries in which to start a business, as far as I can tell from years of personal experience (in other countries) and research.
It's 2025 and your depending on your country they might be getting quite a bit of information (bank accounts, brokerage account, insurances transactions, Beneficial Ownership, etc...) Lookup CRS.
But do any of these setups help you with that? Ie. get a tax free company that is not under your name but under your control. And get an international bank account for that company plus an international debit card.
Plus you would need customers who are cool with paying you through an entity like that.
Not only that but the system is guarded through the banks. Even if you open a bank account for your company, you have to fill beneficial ownership rules for that bank account. So they might end up linking you to it that way.
You should pay a real certified accountant from your country to answer your questions.
The problem with this is that they usually have no idea about international set-ups and many of them are just interested in making money (unfortunately a lot of people are, because money is a very important aspect of our lives).
No those services won’t be legal. If you stay in Thailand for that period you can pay tax there and then use FEIE to not pay double to the US
Ok, this may be true for US citizens who are taxed based on their citizenship, but what about other nationalities (I am not a US citizen)?
The current laws in Thailand state that foreign sourced income is only taxed if it is remitted to Thailand (source: https://mahanakornpartners.com/overview-of-personal-income-t...).
So this should be an option, don't you think?
Same, but residence probably always require a time period. I think it highly depends on your actual citizenship and what tax agreements they have with Thailand etc.
I am not a tax resident in my home country anymore, since I already migrated to a different country (UAE). I am also not trying to avoid becoming a tax resident of Thailand, but as the law seems to state currently foreign sourced income is not being taxed there necessarily.
Your life should be split like this:
One country for citizenship, one country for residence, one country for your money.
This arrangement earns you a lifetime of peace of mind.
Sounds like the "flag theory", I heard that a few times during my research (the quoted services also cite this).
I think this is not so easy though, depending on the individual circumstances. My home country for example might want proof of my tax resident status of the past years if I ever decide to move there again, which will be difficult, if I have not been a tax resident anywhere. Of course this is easy when you reach a certain amount of wealth, but unfortunatelly I am not there yet and might need some time (if ever) to get there.
Why is that optimal?
I understand at least having a dual residency as a back up plan and that’s our plan with establishing residency in Costa Rica before retirement and keeping our by then paid off condo in the US.
It's optimal because you get left the hell alone. Governments do not know what they citizens do if they are neither living in the country nor having their money in the country. Governments do not know what their residents do, if they are neither citizens nor have their money in the country. Governments do not care what foreigners do with their money in their country if they are neither citizens nor residents.
Can you explain a real world scenario based on ease of applying for residence, tax situation, etc?
I haven’t researched anything aside from the US && (Costa Rica || Panama) scenario. There are really no tax advantages or disadvantages that way.
A simple example would be someone who does not have US citizenship (or Eritrea) and is able to move their tax residency to a second country that has very low or no income tax (e.g. UAE).
There are other countries (e.g. Cyprus) that do not require you to stay for 180 days or more to gain residency, so I think this is the kind of setup he is talking about.
The last piece of the puzzle would be international bank accounts, which gets easier the more money you have (e.g. HSBC Expat, which requires 50k USD to set up).
If you're thinking in these terms, then the advice isn't really for you. You are probably better served by staying where you are, paying the tributes you duly owe and obeying the commands of your government.
The real world application of this advice is that you don't ask for permission, and involve governments as little as possible in your life. This of course means that your source of income has to be adapted to this, usually meaning having your own LLC.
Right because the government doesn’t do anything for its citizens and no one should pay taxes anywhere.
Unless you can provid all of the infrastructure for yourself and insure your property rights are secured from people just taking them.
You realize you are going to have to “obey the laws” of whatever country you live in?
The only way you don’t involve some government in your life is to either live in on a boat or to live off the land in the woods somewhere
You know that LLC is also a legal construct you need a government to enforce. Do you plan to get a passport? Do you plan to be “stateless”? Plan on registering for the countries health care system?
Did you read the title of the thread?
So does the title of thread automagically mean there is some method to avoid being ruled by some government except living in the woods or the middle of the ocean?
Or on a beautiful beach surrounded by lovely people.
That beach is not under the jurisdiction of a government? Could I just run around naked without getting arrested?
You will need to learn some different evasion techniques for that.
I understand that you're trying to make a point, but there's no need to provoke him like that. Everyone has to make their own decisions based on their own circumstances, and pushing them in a certain direction doesn't really help. Let's keep it constructive please.
@scarface_74: My goal is to avoid a high tax that I am used to from my home country without getting (enough) in return in my opinion. I would rather take my chances and prepare for retirement etc myself than leave it to a government.
I never want to be "stateless", quite the opposite! I would like to collect some citizenships to have more freedom, because even with a strong rank other passports still give you access to different areas of the world.
I am fine with paying taxes if the rate seems fair (e.g. not 50% of my income if I am not a multi-millionaire) and if I get a good value for it. Yes, security is one of those values, but depending on your situation, a government may or may not be able to provide that (in my case, my home country was not able to do so, another good reason to believe that my tax is not being used well enough to achieve that goal).
> I never want to be "stateless", quite the opposite! I would like to collect some citizenships to have more freedom, because even with a strong rank other passports still give you access to different areas of the world.
The citizenship part is the easiest part. You can never loose your citizenship, and it is in no way tied to your residency or your income/money.
People who dream about migration almost always and erroneously believe that this means that they have to get on a path to new citizenship. But you shouldn't worry about this, unless you are very anxious to be able to vote in elections.
This is not entirely true, for example you can lose your German citizenship if you have another citizenship and fight for a terrorist organisation (source: https://rsw-beck-de.translate.goog/aktuell/daily/meldung/det...).
Then there is US citizenship, which is actually tied to your income, if I am not mistaken.
A citizenship for me would only bring the following advantages
- be able to live in a country without the hassle of renewing visas
- Having a second citizenship if the (political) situation in my home country goes sideways
I am not interested in voting because I do not believe that I can make a difference. I have done so for decades and things have only got worse in my country, so I have lost hope in the political process.
> The citizenship part is the easiest part. You can never loose your citizenship, and it is in no way tied to your residency or your income/money.
If you are a citizen of a country that taxes your worldwide income - like the US it does affect your income. You want to be a citizen somewhere and not end up “stateless”
This is not a reply to you, but a comment for anybody stumbling upon the thread:
You can not loose your citizenship for not paying taxes or for owing any taxes.
Thats much easier - finding countries with lower taxation, citizenship via residency and stable economies. Your initial ask was way more complicated.
Look for countries where you just have to prove stable income, or do some type of investment in the country and then depending on the country it takes between 3-8 years to qualify for citizenship after you become a legal resident