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chuevzla
Member

Where do I Pay my taxes living abroad ?

Hello everyone!

 

I'm a freelancer. I'm from Venezuela currently legally residing in Mexico. I deposit half of my earnings in an USA Bank and the other half in Mexican Bank. 

 

I'm having trouble to understand how and where do I pay my income taxes? do I pay them in Venezuela, Mexico or USA ?

 

Does anyone have an idea on this topic?

 

Thanks a lot

10 REPLIES 10
imakeinternet
Member

You pay tax on the USA bank in the USA.

You pay tax on the Mexican bank in Mexico.

 

Consult a tax professional if you don't understand.


@Mike W wrote:

You pay tax on the USA bank in the USA.

You pay tax on the Mexican bank in Mexico.


 I don't think so. If he is not "resident for tax purposes" in the USA he doesn't have to pay taxes in the USA. He does have to discuss it with a tax professioonal as you say, but he doesn't pay taxes in a country he has no residency, citizenship or legal personal or business presence in.

It really depends on how the money is entering the country.  Pre or post tax.  The USA is notorious for double taxing out of country income under certain circumstances.


@Mike W wrote:

It really depends on how the money is entering the country.  Pre or post tax.  The USA is notorious for double taxing out of country income under certain circumstances.


 For people who are not US citizens, not US residents, don't have any business presence or personal presence in the US and may never even have set foot in the USA?

 

Merely having a bank account in a country does not automatically make you liable for income / revenue taxes.

 

hernandez-luz
Member

Definitely, NOT in Venezuela.

Banks are tightening up. I have a UK bank account (which I have had since the beginning of time) and pay tax in France with the same bank but in France. I recently I had to go through a full verification process with my UK bank - passport, utility bills etc. My brother had to do the same thing. He lives in Brazil and pays tax in Brazil, but has accounts elsewhere and he had to go through the same verification processes. 

 

The OP may have to prove to his US bank where he is paying tax. So best thing to do is to make sure that his status in Mexico is good to go.


@Nichola L wrote:

Banks are tightening up. I have a UK bank account (which I have had since the beginning of time) and pay tax in France with the same bank but in France. I recently I had to go through a full verification process with my UK bank - passport, utility bills etc. My brother had to do the same thing. He lives in Brazil and pays tax in Brazil, but has accounts elsewhere and he had to go through the same verification processes. 

 

The OP may have to prove to his US bank where he is paying tax. So best thing to do is to make sure that his status in Mexico is good to go.


 That's because banks now have much stricter "KYC" (know your customer) rules for anti-money laundering and anti-terrorism etc etc  purposes. Nothing to do with taxes though.

 


@Petra R wrote:

@Nichola L wrote:

Banks are tightening up. I have a UK bank account (which I have had since the beginning of time) and pay tax in France with the same bank but in France. I recently I had to go through a full verification process with my UK bank - passport, utility bills etc. My brother had to do the same thing. He lives in Brazil and pays tax in Brazil, but has accounts elsewhere and he had to go through the same verification processes. 

 

The OP may have to prove to his US bank where he is paying tax. So best thing to do is to make sure that his status in Mexico is good to go.


 That's because banks now have much stricter "KYC" (know your customer) rules for anti-money laundering and anti-terrorism etc etc  purposes. Nothing to do with taxes though.

 


 It is to do with taxes too. Big, big tightening on this - especially when it comes to offshore savings. This is global. Nowhere to hide anymore!!

e_luneborg
Member

For people from Venezuela I don't know, but for europeans we pay taxes to wherever we live for 180 days a year or more. If we don't live anywhere for that many days a year we have to pay taxes to the country where we are citizens. At least that's what my business attorneys told me. Has nothing to do with which country you hold you bank account in. (I have bank accounts in 6 different countries, and I'm not paying taxes to any of those countries. 

 

Side note. Even with strickter KYC and KYB routines there are still places to hide, you just have to know where they are...

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It's the same rule here in Venezuela Eve, your income is taxable in the country as long as you are residing and/or have an income source here.

 

The US tax laws require you to live there or be a citizen for your income to be taxable there, so you shouldn't worry about that. As the others said, consult a tax specialist to analyze your case.