Globe-Trotting Sportsman Or Entertainer: Eastern Europe

An Eastern European citizen with extensive, international, multi-sourced income is not in a good tax situation unless he or she can establish non-residence, since full, world-wide taxation of income and capital gains will apply.

If resident in Eastern Europe, the peripatetic professional may well find himself paying withholding tax in a number of countries which cannot in some cases be reclaimed or set off against local taxation because of the absence of a tax treaty.

Such an individual will almost certainly resort to corporate structures to market his or her skills and manage derivative income flows. It may well be that these can usefully be based in offshore jurisdictions, although complex structures may be necessary if corporate anti-avoidance rules are to be avoided.

Apart from the extra difficulty of minimising tax on the income side, an Eastern European-resident sportsman or entertainer will be in the same position as any other Eastern European resident. (Select 'High-Tax Country Resident' and 'Eastern Europe' for a fuller description).

If a foreign sportsman or entertainer becomes resident in Eastern Europe, then he or she is in the same position as an expatriate executive (select 'Expatriate Executive' and 'Eastern Europe').

Such individuals who have significant business income may be able to make use of offshore corporate tax shelters in order to minimise Eastern European taxation.

Virtually all Eastern European countries have double taxation treaties with Cyprus and Malta, themselves both having offshore tax regimes. This oddity results from arrangements made by the Former Soviet Union, and it will often be the case that foreign business arrangements or the receipt of foreign-source income is best arranged through intermediary companies in Cyprus or Malta.

www.lowtax.net contains details of the offshore business sectors of 35 jurisdictions, and their taxation.

NB: The suggestions given above do not constitute investment advice. They are intended only to assist individuals in finding appropriate professional advice, which is essential for anyone planning offshore investment.