18th May 2022

The World's Best Tax Havens

A ‘tax haven’ used to be seen as something for the ultra-wealthy, but times have changed. Today, even moderately wealthy families and individuals are protecting their wealth by moving it offshore.

Tax havens are countries where there are little to no taxes across income, corporate, capital gains, estate or inheritance. Some tax havens can even provide dividends for those who put their money on their shores.

Typically, a tax haven will be somewhere where you live for extended periods of time to class yourself as a ‘non-resident’ of your home country. Similarly, you will classify your income as not from your original home but of the tax haven you choose.

Is Using a Tax Haven Illegal?

The question of whether using a tax haven is illegal doesn't have a straightforward answer—it's nuanced.

Legal but Strategic
For the most part, utilising tax havens is a legal strategy. Many wealthy individuals and corporations leverage these low-tax jurisdictions to reduce their tax obligations. By taking advantage of favorable tax laws abroad, they aim to manage their finances more effectively.

Crossing the Line
However, things become illegal when the purpose shifts to evading taxes by concealing assets or income from tax authorities in one's home country. This can involve failing to disclose offshore accounts or misreporting income, which could lead to serious legal consequences.

In summary, while the mere use of a tax haven isn't inherently illegal, the legality depends on full transparency and adherence to tax laws. It's crucial to differentiate between lawful tax avoidance and illegal tax evasion.

The Best Tax Haven

This decision requires a lot of time and commitment. Therefore, deciding which tax haven you pick to put your financial roots is a huge life decision.

Factors we looked at when deciding on what makes a good tax haven came in the form of the following:

Tax Rating

This number shows how easy it is for one to store their wealth and the type of taxation it succumbs to. A 100 rating will be a country where anonymity, 0% taxation and even rebates will be seen, whereas a 50-75 rating will be a country with nominal taxation, less secrecy and no form of rebate or interest.

Average Monthly Rent

We looked at the monthly rent cost a tax haven would require. Some of the more lavish and luxurious tax havens will have a high accommodation cost. Fortunately, most of the tax havens have a high standard of rentals, whether it's a beachfront house or a central apartment.

Safety

When moving to a tax haven, safety will be crucial and comes in all forms. Whether it’s the terrain and roads or general street crime, we used external advisory ratings to find which was the safest.

Internet Speed

Having a solid, functioning internet in a tax haven is crucial when you are working remotely and managing your finances. Setting up in a tax haven requires lots of moving parts, so having a strong internet is a must. Some of the tax havens have internet which will cause many laggy Zoom calls, all the way to some of the best internet speeds in the world.

Weather & Beaches

Fortunately, the places where your money is most hidden are also the same places with some of the most beautiful beaches and warm climates. Whether it’s the pink sands of Bermuda or the scenic countryside that Jersey can offer, there is a tax haven to suit everyone’s tastes.

Bars and Restaurants

Similarly to the weather and beaches rating, we took a look at the quality of the dining and drinks available on all the tax havens. Whilst some lack a diverse menu due to location, most have an incredibly high culinary standard, with many boasting Michelin-starred restaurants and the best bars around.

We have crunched all the factors above to find out where the world's best tax haven is.

Here is a detailed look at the world's top ten tax havens, starting in reverse order with number 10:

10. Bermuda - 68.5/100

Bermuda has found itself to be a favourite tax haven for some of the world’s wealthiest in recent years, with an ideal location in between Europe and the United States. An idyllic location, the luminous turquoise waters and sandy beaches make it a hotspot for the wealthy looking to stash away money.

Similar to the other Caribbean islands on the list, there are no corporate, capital gains or estate taxes. Bermuda is the home of some of the most notable tax avoidance schemes, when it was exposed that both Nike and Google had put billions in the Bahamas five years ago.

A monthly rental in Bermuda follows the expensive pricing of others in the Caribbean, as accommodation costs on average £2,550 and follows the trend of a lavish, luxurious lifestyle that the wealthy inhabitants are used to. Whether it’s a cottage at the centre of the island or an apartment overlooking the ocean, the properties are of a high standard and are usually yards from a stunning, picturesque beach.

Bermuda has a safety rating of 2.5 out of 5 but can be found to be a largely peaceful place. The biggest concerns can range from the infamous Portuguese Man of War that can do some serious damage to swimmers, or the self-employed and non-regulated taxi drivers who can take advantage of tourists. Just like other Caribbean islands, a hurricane risk is very real and must always be in mind.

The dreamy Caribbean island has some of the best internet in the region, hitting 42.3 mbps. This attracts many remote working travellers and business people who want to manage their finances and operations from anywhere. It’s hard to find a more peaceful working space than a Bermudan beach.

The weather and beaches rating saw the island get 71. Whilst Bermuda is a tropical paradise for tourists, the weather can be very stuffy and uncomfortable in some parts of the year. The summers can be very humid and sweltering, but the autumns and winters are cool and warm. This leads to many visiting in those particular times and avoiding the summer. The beaches, like Warwick Long Bay Beach, are some of the best in the world however, and can certainly make up for any oppressive weather or hurricane risk.

The island can boast a rating of 91 for some of the highest standards when it comes to bars and restaurants. If you are in Bermuda, you would quickly get accustomed to the island’s passion for rum. The bars and restaurants are elegant, traditional and perfect for many occasions. You can go to Boundary Sports Bar and Grill to watch sports and get a drink and a steak, or head to The Dock at the Waterlot Inn, a hidden away spot where you can enjoy a drink and watch boats sail into harbour.

9. Isle of Man - 68.5/100

The Isle of Man is one of the more compliant and ‘above board’ tax havens on the list - to the point where the island is just off the coast of Liverpool. Make no mistake, it is still one of the most desired locations for wealthy individuals, corporations and growing tech startups.

The lack of inheritance, capital gains and corporate tax makes it a perfect landing spot for the rich, as well as the low-income tax and its use for hiding private jets for the uber-wealthy.

The monthly rent to live on the peaceful, quaint island can cost around £1,881 - the arrival of multinational tech and gaming companies has seen the rapid development of luxury apartments and flats too. Whilst pricey, you will find the living accommodation to almost always have a sea view and be within walking distance of amenities.

The Isle of Man was also found to be one of the safest places to live in the world. A 0/5 rating shows it to be one of the safest tax havens, with the only danger coming from occasional heavy winds and drunken anti-social behaviour during the world-famous TT motorbike race.

The internet speed can be a slight issue for those living on the island, with the internet speed reaching around 28 mbps. Whilst it isn’t terrible, the speed can often find video conferencing and online gaming affected.

The Isle of Man weather rating hit a lowly 57, in large part due to the brutal winters it can have. The cold temperatures and gale force winds are accompanied by horizontal rain. Summers can provide a brief but beautiful respite from these conditions, with beaches in Ramsey, Castleton and Port Erin resembling a tax haven in the Atlantic Ocean rather than the Irish.

Tough weather can lead to very warm and welcoming pubs and restaurants. A rating of 82 was given for the wide array of traditional, folky pubs to high end, luxury dining. Pubs like the Thirsty Pigeon have built up an esteemed reputation on the island, and bars such as The Courthouse are packed every weekend.

The Isle of Man will give you some of the best fish and chips you will ever find, alongside some of the freshest seafood dishes available. Whether you’re eating at Enzo’s Restaurant, Portofino or the Port Jack Chippy & Diner, the food is of the highest quality.

8. Singapore - 69/100

Singapore has retained its tax haven label despite raising taxation on inshore corporations and individuals. The loophole of offshore accounts and income not being taxed remains and makes Singapore one of the best tax havens in the world.

At an average monthly rental of £842, Singapore is one of the best options for luxurious yet affordable accommodation. A modern and advanced city, akin to Dubai for its monumental growth and expansion, it offers amazing flats and apartments at a reasonable price.

Singapore received a safety rating of 3 out of 5. Despite being incredibly safe and well-policed, there is rampant bag snatching and pickpocketing in certain areas, so it is recommended to watch your items. The danger of flash floods and the underlying threat of terrorism have caused the rating to go higher than usual.

Singapore was just pipped to the fastest internet in the world by Jersey as it has 255.8 mbps. The

Having weather that is sporadic and that succumbs to monsoons, brings Singapore down to a weather rating of 59. Whilst the weather can be all sunshine, it’s often found to be very humid and uncomfortable at times for expats. Random showers and thunderstorms are common, so carrying an umbrella is a must.

Singapore’s illuminating cityscapes are bringing comparisons to Las Vegas and Dubai. The modern architecture and designs are also accompanied by new and brash restaurants and bars, aimed at making Singapore a hot spot in East Asia for drinks, food and entertainment. It’s rating of 86 puts it in esteemed company, with Spago Bar and Employees Only just to mention a couple of highly-rated places. If you like a Singapore sling, there could be worse places to place your money than the Garden City.

7. Lebanon - 69.9/100

Despite possessing a tumultuous economic history, Lebanon is one of the main players in the Middle East for tax avoidance. Whilst it holds a small number of offshore accounts, it has levels of anonymity and privacy for wealthy Middle Eastern individuals and diaspora that allows for lenient taxation.

A sleek modern apartment to rent in Beirut could set you back around £984 a month, but all are very luxurious and provide great access to a city that has much to offer.

Lebanon hit a safety rating of 3.2/5 as it is neighboured by Syria which is still suffering from an ongoing war. Similar to a lot of Middle East countries, the driving is high speed and reckless, with roads also going along mountainous terrain. Pickpocketing is rife so belongings must be kept safe at all times. Lebanon is afflicted with natural disasters, from severe earthquakes and tsunamis to floods, forest fires, droughts and landslides. Mugging and organised crime have risen over the years so travelling in groups is recommended outside of Beirut.

Whilst it is usable, the internet is incredibly unreliable at 16.3mbps, bettering only the Cayman Islands and Malta.

Lebanon hits a rating of 89, as it boasts a stunning climate, being a country where you can go for a ski early in the day and head to the beach in the afternoon. The weather is very comfortable with hot and dry summers followed by wet and cool winters. Its Mediterranean coast gives it beautiful beaches and picturesque peaks.

Lebanon has a well-deserved score of 94 for its food and drinks on offer. A wondrous mix of Lebanese, French, Levantine and Mediterranean cultures, the restaurants and bars vary from Lebanese meze to luxury cigar and cocktail lounges.

6. Liechtenstein - 70/100

The tiny European country is the least-visited country in Europe, with a population of 37,000 and is smaller than Washington DC. Despite this, it is one of the most incriminated tax havens in the world. The tiny Alpine area, squeezed in between Austria and Switzerland, is used by wealthy corporations and families to stash billions.

Compared to the previous tourist hotspots, Liechtenstein’s average monthly rent is £789 with apartments and holiday homes available. Almost all have breathtaking views of the Alps.

Liechtenstein has a safety rating of 2.5 out of 5, with a warning given for the treacherous conditions of the Alps, with avalanches posing a real threat. The wintery conditions can make driving treacherous, with decreased visibility common.

The Alps hideaway boasts some of the fastest internet in the world, hitting speeds of 211.2 mbps. This is a draw for technology companies to set up here, building on the uber-fast internet and super low taxation.

Liechtenstein has a weather rating of 64, with its summers wet and comfortable but long and cold winters. Whilst the weather brings in snow sports and skiing activities, it can create danger for day-to-day travelling.

Maybe most surprisingly, the cuisine and drink of Liechtenstein hit a rating of 93, with flavours for every palate. Vaduz holds Bistros that are world-class, with multiple Michelin accredited restaurants like Restaurant Maree or Restaurant Markel. Whilst pricey, it had endeared itself to the locals with many happy to pay the maximum for the world-class dining experience.

5. British Virgin Islands - 72/100

The British Virgin Islands remains one of the premier world tax havens with its zero percent taxation - including personal, corporate, inheritance, sales or gift tax.

Following the trend of other exotic Caribbean islands, the British Virgin Islands has incredibly expensive monthly rental costs for accommodation, reaching an average of £2,122. Similarly, almost all the properties for rent are either steps from the beach or boating decks, infinity pools and jaw-dropping landscapes of the ocean.

The British Virgin Islands has a safety rating of 2.5 out of 5, with warnings given for the island's terrible driving standards and a large number of scorpions.

It has a standard internet speed of 28.1 mbps allowing for reasonable internet access and the ability to digitally work and manage your finances.

Luminous blue ocean, bright skies and a luxurious tropical climate give the Islands a weather and beach rating of 87, with Tortola, Virgin Gorda and Jost Van Dyke hosting some of the globe's most beautiful and relaxing spots.

The British Virgin Islands reached a score of 86 for its bar and restaurants, as it has some of the best on offer in all of the Caribbean. Bars and fine dining outlets like Cane Garden Bay and Brandywine Estate are some of the most desired by tourists, who have left rave reviews.

4. Turks & Caicos - 72.5/100

Turks and Caicos have no taxes, whether they are personal, corporate, profits, assets, capital gains or estate. Its well-known nature for being a tax haven has seen it come under scrutiny over the years, but it remains one of the best world tax havens.

Similar to other Caribbean tax havens, the monthly rentals are incredibly expensive but luxurious with the average price hitting an eye-watering £2,260. Safety is also a concern on the island, with it being given a 3 out of 5 rating by the Travel Advisory.

It has high internet speed for a Caribbean island, hitting 61.8 mbps, a fast speed for the region. This fast speed attracts many financial firms to select the island as its tax haven.

The island's weather and beach rating of 87 makes it one of the more desired tax havens out there. It has the least amount of rainfall out of all the Caribbean islands but can get mildly muggy during the summer to October. The island is surrounded by one of the planet’s biggest coral reefs, making a diving experience a must.

Likewise to the other Caribbean islands, the sandy beach bars and high-end foreign cuisine on offer really make it a tax haven paradise. It hit a high 90 rating for its bars and eateries on offer.

3. Jersey - 77.5/100

Whilst Jersey is not the supreme tax haven it once was over 10 years ago, it has still kept out corporate, wealth, inheritance and capital gains tax allowing wealthy individuals to still exploit the legislature and keep their wealth protected.

Its average monthly rent of £1,380 sees it rank 14th out of 44 world tax havens for its living accommodation cost, although Jersey boasts some of the nicest and most modern apartments and condos.

It has a safety rating of 0 out of 5, making it one of the safest places to live in the world. It is tied 1st with Guernsey, Gibraltar and the Isle of Man.

Jersey holds the title for having the fastest internet in the world, with tech and gaming companies locating to the island for its 274.4 mbps.

Whilst the weather and beaches won’t match up to the Bahamas or Anguilla, Jersey’s St Brelade’s Bay is stunning in the summer and can be Caribbean-esque in the peak of summer. The weather is varied and makes for comfortable living, hitting a 71 rating.

Jersey has a high end variety of bars and restaurants, whether that is the Cock & Bottle or The Terrace at L’Horizon Beach. The island scored an 80 rating from the averages of Tripadvisor reviews for its drink and food offerings.

2. Anguilla - 81.3/10

Anguilla, a British Overseas Territory, issues no tax on offshore companies that get income outside Anguilla. Similarly to the Bahamas, it does not impose income, estate, gift or capital gains taxes.

Anguilla has a host of luxury apartments, cottages and condos that almost always have a beautiful vantage of the ocean and a pool to boot. The average monthly rent can hit around £1,241 but you certainly get value for money.

Anguilla was given a 2.5/5 safety rating, with petty theft and natural disasters being the biggest cause for concern. Hurricanes can occur from June to November but Anguilla has a developed National Hurricane Centre for citizens.

Anguilla boasts over 33 serene beaches despite being such a small cluster of islands. The beaches are ranked by some as the best in the world, with the weather and warm temperatures creating stunning conditions. This gives Anguilla a rating of 88 for its weather and beaches. The rain season can often bring issues to islanders, as well as the humidity. Whilst from November to March the weather is paradise, the humidity can be uncomfortable from June to August.

Whilst you won’t find a host of cuisines in Anguilla, you will be overwhelmed by the choices for a laid-back drink on a sandy beach. The beach bars are everywhere, making it easy to get a cold bottle of beer and sit on the golden sand. The seafood is world class, with high end French and Italian eateries set up on the island. The homely Caribbean cuisine is renowned by those that visit. All these factors give Anguilla a 90 by people who have eaten and drank on the islands.

1. The Bahamas - 86.9/100

The Bahamas is one of the most popular expatriate destinations for good reason. Crystal clear ocean, bright sunshine and fine-sand beaches make the island a paradise in its own right. It also helps that being a resident gives incredible tax benefits.

The Bahamas has some of the lightest tax policies in the world, with the government not enforcing income, sales, gifts, estate or capital gains taxes.

These easy-going tax policies invite investors, business owners and wealthy individuals which contributes to a stable local economy. The Bahamas is one of the more VISA-friendly countries, offering options to get permanent residency after just a couple of years.

One of the more expensive places to live, the average monthly rent in the Bahamas is around £1,795 but the properties usually involve being just yards from a beach or having their own pool. The luxury makes sense given that most residents will have a lot of disposable income.

Whilst tourists and expatriates are safe, the Bahamas has seen crime rise over the past few years. It can range from taxi drivers overcharging and pickpocketing to violent mugging which has risen. The Bahamas was given a 3/5 rating for safety with 5 being unsafe to visit.

Whether it’s the Tropic of Cancer beach in Exuma or the Beaches of Stocking Island, all 16 islands have isolated, peaceful and dream-like beaches for its residents. The Bahamas hit a score of 80 for its weather, making it one of the best climates of all tax havens. The weather can be tough without air conditioning for permanent residents.

The Bahamas has plenty of bars and restaurants for everyone, whether it is the spectacular Atlantis Casino Resort in Nassau or beach bars like The Daiquiri Shack. There are hypnotic nightclubs and luxurious bars or small beachfront bars for you to watch the sunset with a drink. The Bahamas bars and restaurants hit a score of 80.

How SmartSearch can help?

SmartSearch provides comprehensive compliance solutions that help businesses mitigate the risks associated with tax havens. SmartSearch has a range of highly advanced verification solutions that enable its customers to identify, verify and screen individuals, businesses and the ultimate beneficial owners of businesses.

The consequences for enabling money laundering are severe – financially, legally and reputational – and ignorance is no excuse. So, if your business is looking to work with individuals or businesses located in a tax haven, it is vital that you understand the risks associated with that and put the proper procedures in place to protect your firm.

Speak to an AML and compliance expert today to discover more.

Access the full data set here

METHODOLOGY

Smartsearch conducted this research with the aim of finding out where the best tax haven is in the world. The study evaluated factors such as taxation, monthly rent for accommodation, weather, safety, internet speed and bars and restaurants.

For each of the 44 countries and territories the overall index rating was based upon the Tax Justice Rating, the average monthly cost for an Airbnb, the Travel Advisory Board’s safety rating, the internet speed according to Speedtest.net, the weather rating from weatherspark.com and the average Tripadvisor rating for both the best 20 bars and restaurants.

Following the data collection, all figures were indexed to give a rating out of 100 for each country.

*Tripadvisor, Airbnb and Weatherspark data was collected from 1st March 2022 to 15th April 2022.

SOURCES

ICIJ.org

TheStreet.com

Investopedia.com

Travel-advisory.info

Traelsafe-abroad.com

Numbeo.com

Weatherspark.com

Airbnb.com

Expatisan.com