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Inspired by this Reddit thread and other stories of people working remotely from all over the world, apparently without giving too much thought to the legal implications, Working abroad remotely and UK taxes:

I work remotely abroad for most of the year (usually a new country every month). I'm registered as self employed in the UK and pay 40% on tax. I've taken the UK tax residency test on the Gov UK website and it states i'm not a tax resident of the UK. I don't pay tax in any other country and the company i'm contracting for is not registered in the UK (its in the EU).

I'm confused about where / if i should be paying tax.

I am wondering - what is the worst-case scenario? Could one hypothetically end up in a situation in which two (or more) countries all simultaneously consider one to be tax resident for the same year, and each demand their headline rate of income tax on the same income?

Tie-breaker - which combination of simultaneous tax residencies would result in the highest total marginal rate of income tax? Is a figure of over 100% possible?

For full credit, answers should take into account:

  • The tax residency rules of each country (obviously!)
  • All relevant double tax treaties
  • All instances where one country would offer a tax credit/refund based on tax paid in any of the others, based on its own domestic law, in the absence of a treaty.

You may assume any nationality or level of income you like as long as you state it in your answer.

After undertaking a small amount of initial research, it turns out that owning or leasing a private residential property is a very easy way of acquiring tax residency in a large number of countries. On reflection, however, since this question was inspired by digital nomads, let's also assume that the individual in question is reasonably nomadic and owns or leases a private residential property for their personal use in at most one country.

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    A similar situation arises between US states. For instance, New York has a rule that anyone who has a permanent home in New York and spends 185 days there (where any part of a day counts) is a tax resident. New Jersey has a similar rule. So if you own or rent homes in both states, and commute across the state line on most days, you might be a resident in both. However, each state will allow you to claim a credit for taxes paid to the other, so that you don't end up being fully double taxed.
    – Nate Eldredge
    Commented Mar 20, 2023 at 17:01
  • @NateEldredge - Substitute California for one or the other and then you've got real troubles as California is even more rapacious hard though that is to believe.
    – davidbak
    Commented Mar 21, 2023 at 22:24

1 Answer 1

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Sample answer:

  • Be a US citizen - automatic US tax residency
  • Own a UK property and live there for 91 days to gain UK tax residency
  • Spend 60 days in India plus a total of 365 days over the previous 4 years
  • Spend 62 days in Norway, having been tax resident there the previous year. If I understand correctly, this status can be maintained indefinitely by spending 62 days there per year once first gained.
  • Spend 120 days in Paraguay
  • On the last day of the tax year, start working in the Philippines on an indefinite contract
  • Spend 183 days or more in Singapore during the prior tax year
  • Spend a total of 270 days in Mauritius over the current tax year and the previous two years (our calendar is getting pretty constrained at this point but I think this is still all technically possible)
  • Have access to a spare room that a friend informally keeps available for you in Germany
  • Be a member of the crew of a vessel registered in Mozambique
  • Have at least one essential connection to Sweden, having been tax resident there less than 5 years previously
  • Have a spouse who lives as a permanent resident in Spain and is somehow a contributing member of the Commonwealth Superannuation Scheme (triggering Australian tax residency)

Total tax residencies: 13

Total marginal income tax rate after double tax treaties and reliefs for the tie break: no idea

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    You’ve only used 151 of 365 days - surely you can get residency in other places too?
    – Dale M ♦
    Commented Mar 20, 2023 at 20:51
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    @DaleM I have squeezed in two more and now I'm down to my last 31 days in the current tax year. The question now is how to arrange my calendar for the previous 5 years...
    – user3490
    Commented Mar 20, 2023 at 21:50
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    @Malady the first year, you need 183 days in 12 months (or 270 in 36). But you need less to "maintain" it, so presumably the answer does it that way to fit more days in.
    – mbrig
    Commented Mar 21, 2023 at 4:12
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    @Peter-ReinstateMonica only 334 days are allocated within the tax year of interest. Allocating the days within the 5 previous tax years to meet all the requirements is left as an exercise for the reader.
    – user3490
    Commented Mar 21, 2023 at 9:54
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    Jamaica: you or your spouse maintain a home there, which you visit for at least one day in the calendar year.
    – alexg
    Commented Mar 21, 2023 at 11:00

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