Geographic Arbitrage

Crossing multiple areas here.

Early retirement, taxation, residency, investment, pension and not sure where else to write this

Getting closer to that retirement and been planing geographic arbitrage. Know the risks (example health care/currency fluctuations etc) but really want to follow the dream and thinking ahead of having options.

For example, what to do towards the pointy end of life if needing old age care (Australia better) plus it seems the country in question is tightening expatiate rules so having a way out is a good idea. Also, if the retirement simulator worst case happens maybe the pension could be useful at some stage

An option instead of selling up property and becoming a non-resident of Australia which has it's taxation +'s and -'s is to use a portion of capital and buy a cheaper property in SE Queensland and try to stay an Australian resident. It would make it easier to receive the pension if in the future investments turned south or had to return for whatever reason.

If we buy a 2 bed unit close to a touristy area and used a holiday accommodation manager or Airbnb and close it off and return a couple of weeks every 6 months. I think this would cover the residency and we might earn a bit from the capital and keeping a foot in the door.

Anyone else have thoughts about geographical arbitrage?

 

I’m setting up for geo arbit in the next ten years myself. But a bit differently. All property in aus will be investment property. Structuring regional rural new build as an air bnb. Use this as occasional bolt hole. Second one in city same thing. We are moving to a mobile lifestyle. Where we can live and work anywhere in the world from a computer accessing the cloud to run our businesses.going for automation and minimal hours of work input in all our ventures.
We have a motorhome in australia and use this for a lot of our australia time.
We want to be 6mths of the year OS. Using geo arbit to our advantage and to live and work in a variety of countries and cities across the world.
So yep we are setting up for this too. Just have to have a good cash reserve and good international health insurance coverage. Factor it in. good luck with it all.
we are still in a restructure phase. Setting up our investment approach and automated system starts end of this week when we settle on sale of our PPOR.

 

@Alex_Alex

What's the country?

 

with the proposed changes to residency rules spend more than 45 days in australia and the tax arbitrage will be gone.

 

Have you heard anymore updates? They would just about impact me with the 45 days test as I work in the US (and have done so for 7 years!) but spend Christmas and other visits to family in Australia. Mind you those proposed changes don’t overrule Dual Taxation Agreements so things will get very interesting indeed.

 

Mal no still nothing so the old rules are still in play. Might be like the proposed changes to DIv 7a and we will get something 5 years later

 

And the property developer consultation supposed rulings ...and.....
Then out of the blue the ATO mentions trust reimbursement rules and more.

The residency one seems like a gentle simmer as was meant to be the work of the Bored of Taxation (apt name) . Next session of Parliament perhaps.