Any foreign countries out there that don't tax disability income from the US government?

[Victor_c3]

I'm receiving three forms of disability retirement from the federal government of our country and I've been thinking off and on about living abroad for years now. However, the biggest obstacle is that I believe most nations would tax my disability income that I receive from the US government (which isn't taxed here in the US).

Anyone aware of any nations that wouldn't tax my disability income? I'm mostly interested in living in Europe and maybe Australia / New Zealand.

The three incomes I receive are SSDI, disability from the VA (I'm 100% service connected disabled), and disability from FERS (federal employee retirement system disability).

edit to add that I'm not necessarily stuck on countries that speak primarily English. I lived in Europe for 4+ years and never had a problem getting along in any nation I visited despite the fact that I didn't speak their native language.

Thanks for any thoughts!

[mnhtnbb]

1. I think the way you get around this is not to bring your income to the country where you are living.

Keep your bank account in the US. Have your checks deposited there. Get yourself a credit card with no international transaction fees
and use it to access your funds. Use a friend or relative's address for your US address.


I know Americans who live on Bonaire most of the year who do this.

I suspect most countries will require you to have a checking account, but if you have sufficient funds that aren't "income" you can stash
some money there that way.

International Living is a good resource. https://internationalliving.com/

[discntnt_irny_srcsm]

2. My understanding of foreign finance is limited

I suggest checking with an attorney practicing law relating to this topic.

IMHO, if you remain a US citizen and do not apply for foreign citizenship nor permanent residence and your US based payments are paid domestically to a US account and you maintain at least a shared residence in the US, I don't see why foreign taxes would be involved. Many people embark on foreign travel for extended periods of years.

As a foreigner there may be limitations on transactions like buying real estate.

Most countries have visa requirements for extended stays and you and your attorney should investigate what is required to comply. I found this link on travel from the US Dept. of State: http://travel.state.gov/content/passports/en/country.html

As I understand it most countries limit your ability to "earn money" based on your being in their particular country. This likely varies from place to place and probably doesn't affect you since you won't have earned income. You probably would need to travel often (depending on your selected area) maybe every 90 - 180 days to avoid qualifying as a resident. US taxes are based on citizenship but most foreign tax is based on residence.

You should also check with your state's voter's registration department as to the residency requirements regarding foreign travel and eligibility for voting.

OTOH some of your benefits may directly hinge on continued US residency. You're probably aware of the VA benefits page:
http://www.benefits.va.gov/persona/veteran-abroad.asp

Also, if you intend to maintain US citizenship (which I assumed) you should file a federal 1040 every year even if owe nothing to maintain that fact for the IRS. Establishing an account with a foreign bank or financial institution will likely put you on IRS radar for investigation: http://finance.yahoo.com/news/non-us-residents-abroad-must-file-income-taxes-195444214.html

Please consult professionals for good advice in this matter.

An example of a foreign tax might be the UK VAT and I don't see a way around paying that.

[discntnt_irny_srcsm]

3. You may want to avoid countries on the state dept's "designated list"

I infer that frequent travel to or from these countries may place you on a "list".

http://oiir.hq.nasa.gov/nasaecp/DCList_07-01-15.pdf

AF
Afghanistan

BH
Bahrain

BY
Belarus

BT
Bhutan

MM
Burma (Now Myanmar)

CT
Central African Republic

CN
China, Peoples Republic

CI
Côte d’Ivoire (Ivory Coast)

CG
Congo (Formerly Zaire)

CU
Cuba

CY
Cyprus

EG
Egypt

ER
Eritrea

GN
Guinea

HT
Haiti

HK
Hong Kong (One China Policy)

IR
Iran

IQ
Iraq

IL
Israel

KG
Kyrgyzstan

JO
Jordan

KP
Korea, North

KW
Kuwait

LB
Lebanon

LR
Liberia

LY
Libya

MO
Macau (China)

OM
Oman

PK
Pakistan

QA
Qatar

SA
Saudi Arabia

SO
Somalia

LK
Sri Lanka

SU
Sudan

SY
Syria

TW
Taiwan

AE
United Arab Emirates

VE
Venezuela

VN
Vietnam

YE
Yemen

ZM
Zimbabwe

[KamaAina]

4. Israel puts you on a list?

But we wuv Israel!

[discntnt_irny_srcsm]

5. I didn't say "does", I said "might"

Despite our buddy-buddy links with Israel, they do have a bit of history spying on us.
Google Johnathan Pollard.

Israel is only on the list due its possession of missile technology. Of the listed countries, I would say Israel would be less worrisome for USDoS than say North Korea.