Citizenship and Residency Services for the Rich

Wealth Has Its Privileges
CC Photo Courtesy Brian Harte

Note: this is not a paid post and I've never been in touch with Henley & Partners or any associates of theirs. I'm merely familiar with their reputation.

Generally when I write about how to become an expat, I focus on things like the UK Entrepreneur Visa, teaching English, or the European Blue Card. These and many other strategies are broadly applicable to people who are determined to get out, but don't necessarily have lots of money, a marriage proposal, or other easy means of moving abroad.

Today I'll talk about Henley & Partners. They're a firm which specializes in providing those with spare money the opportunity to move abroad.

One of the countries that Henley & Partners will help you gain citizenship in is St. Kitts. For only $250,000 US, you can buy citizenship in St. Kitts. You don't even have to sully your Stuart Weitzman stilettos by visiting the place if you don't want to. Oh, and they have no personal income tax.

Henley also advises countries about citizenship by investment and both Malta and Croatia are said to be considering it. Ireland has revoked theirs, but Dominica still offers citizenship by investment and it's as low as $100,000!

Not keen on becoming a citizen of either St. Kitts or Dominica? That's OK. You can apply for residency in countries such as the United Kingdom. For only one million British pounds, you can buy residency in the UK (that's about $1.5US million). Or maybe Belgium is more to your liking. They can help you start a business in Belgium and get citizenship after only three years of residency.

Henley & Partners offer a variety of other countries they can help you get residency or citizenship in. Even a brief search of the net reveals many, many programs for buying citizenship or residency in other countries, but be aware that many are scams. If you are able to go this route and choose to do so, stick with a reputable firm or a lawyer you can trust.

Reverse Culture Shock - You Can't Go Home Again

My wife and daughter playing with bubbles
in a friend's back yard in Portland.

My sincerest apologies for having dropped out of sight for a bit. I spent two weeks in the US, part of which was in Austin for a conference and also visiting my mother, sister and niece.  It was my first time back in Texas in 27 years.

The rest of two weeks was spent in my beloved Portland, Oregon visiting friends and my uncle and aunt. While enjoying the thrills of jet lag, I'm remembering that there is no past, only a future. I love Portland, but it's no longer home despite all of my wonderful friends there. It was with relief that I arrived at Charles de Gaulle airport in Paris and knew I would soon be collapsing in my bed. I had experienced reverse culture shock.

This is not an unusual feeling for expats. Ceri, in the United Kingdom, writes about returning home after 18 months abroad teaching English. While she doesn't describe her situation as reverse culture shock and she's talking about the mess of British bureaucracy, she is nonetheless struggling to readjust to being home. Or you can read Tim Pile's description of visiting his family in the UK while he lives in Hong Kong. Or maybe you should read CNN's reverse culture shock adjustment tips.

And yet those various things they discuss, all of which I can relate to, aren't quite what I had in mind. But first I think I will offset the downsides with the upsides. My wife and I loved Portland and we're considering doing an annual house swap for a month during the summer to give our daughter (and ourselves!) more exposure to the US. The US is great in many ways, not the least of which is the friendliness and generosity of the people (just look at how much money the US donates when an international disaster strikes). The food is great (if not fattening) and thanks to cheap land, houses are huge and inexpensive compared to much of Europe.

Your author (blue shirt on the right) with his
uncle and aunt at the Portland Zoo.

And then there are the downsides. My uncle is paying $1,400 a month (!) for medical insurance that he's about to lose it. More than half the people in the US now believe that a college education costs more than it's worth and half of all Americans live in poverty. And to top it off, despite the real political problems here in France, France is far more of a democracy than the US (honestly, Romney was the best the Republicans could come up with?).

I don't know what the future holds for the US and I certainly hope it goes well, but I'm not seeing any signs of that right now. And to my shock, I've actually had conservative friends tell me that they wouldn't blame me if I gave up my citizenship. Conservative friends! I am not surprised by those comments from those on the left (well, the US version of "left"), but on the right? I have no desire to give up my US citizenship, but hearing conservatives tell me they wouldn't blame me if I bailed was yet another shock. Reverse culture shock usually involves the person returning home realizing they've changed. While that's certainly true for me, it's also true that the country I visited isn't the country I left.

So I'm back in France and I'll resume blogging again, but my last trip to the US was bittersweet. It was lovely seeing family and friends and it brought back many fond memories, but it really helped to reinforce to me that I can't go home. No matter what happens, I am and will always be an American, but I like the values over here in Europe. I like knowing that medical care is a right and not a luxury. I like knowing that my daughter won't be saddled with decades of student loan debt. I like knowing that we get enough vacation time to enjoy life and don't have to hoard vacation days carefully, occasionally spending one for a glorious three-day weekend.

I'm happy abroad and have no strong desire to return to a plutocracy.

Australia Seeking Foreign Students

Sydney Harbor
Photo by Paul Bica

Australia — the land of sunshine, drop bears and Olivia Newton-John — is working to make Australia an attractive destination for skilled expats. I've previously written about how Australia is making it much easier for skilled US workers to seek work in Australia, but now they've changed the Australian Temporary Graduate Visa to make it easier for international students to remain in Australia.

In reversing some Australian 2009 visa restrictions, Australia is now set to allow all foreign graduates of Australian universities to work in Australia for up to four years. In this case, the Temporary Graduate Visa allows you to remain in Australia for at least 18 months, but if you meet certain qualifying criteria, you can remain for up to four years, at which time you can receive permanent residency and remain in Australia. To be eligible, you must speak English, have graduated from an Australian university and be under 50 years of age. The following applies:

Graduates who have completed a Bachelor degree, Masters by coursework degree or Masters (extended) degree in Australia are eligible to apply for a two year post-study work visa.

Graduates who have completed a Masters by research degree or a Doctoral degree in Australia are eligible to apply for a three or four year post-study work visa respectively.

It appears that much of what has motivated this change isn't just "we want skilled workers" but "our universities need more money". The strong Australian dollar and reports of violence against foreign (mostly Asian) students has led to Australian universities experiencing a much lower foreign enrollment rate. Unlike Europe, Australia follows the US model of making universities profit centers, so any threat to said profit is a general threat to a large sector of the Australian economy. However, while it's far more expensive to study in Australia than most of mainland Europe, it is claimed that studying in Australia is less expensive than either US or UK universities.

PRISM's Impact on Europe

Over on my personal blog, I've written a post about the US government's PRISM surveillance program. It's going to impact Europe, too, which is why I mention it here. In short: this program mean that many large US companies have been violating EU law and were probably explicitly lying about it. This is not going to end well.

A Trio of Painful Stories for Americans Abroad

IRS Logo

Given the recent scandals involving the IRS, it's probably no surprise to anyone that the IRS has now been accused of "entrapment" of Americans who live abroad and — gasp! — have bank accounts where they live. Many of the punitive US laws against offshore bank accounts, such as FBAR, FATCA and others, and programs such as OVDP and OVDI are specifically intended to catch tax evaders. This is the IRS description of their objective for the OVDP (Offshore Voluntary Disclosure Program) (emphasis mine):

The objective remains the same as the 2009 OVDP and 2011 OVDI – to bring taxpayers that have used undisclosed foreign accounts and undisclosed foreign entities to avoid or evade tax into compliance with United States tax laws.

But the problem is that many people abroad who have met all of their tax obligations but never knew about little-publicized laws are having huge portions of their assets confiscated, despite no demonstration of intent to avoid or evade taxes. The American Citizens Abroad director has this to say (again, emphasis mine):

“By luring them into the OVDP in a form of entrapment then hitting them with ruinous penalties based on the overseas assets, instead of using the discretion which was within IRS purview for benign actors, the IRS treated ordinary, hard-working Americans like criminals. Most of the unreported accounts were pension funds and basic financial accounts used for living expenses and were not being used to hide assets.”

In the next painful story, the Atlantic writes about the unintended consequences of these laws against expat banking. In particular, the article points out that the laws being passed will have little effect on the wealthy they're designed to target but will continue to hurt middle-class Americans who live abroad and have bank accounts for the sole purpose of paying their bills. After all, as I live in France, it would not be particularly easy or convenient for me to drive all of my banking through a US account.

Americans living abroad are also sometimes getting their bank accounts frozen due to the new US laws. Writes one lawyer from the Atlantic article:

“I know of one client whose parents live outside the US. They are in their 90s, and have a bank account in their home country. They added their son as a signatory because if they become incapacitated, they want him to have access to money to pay their bills. But their account has now been frozen because he's American. The bank wants the son to provide the last five years of his tax returns before it will unfreeze the account. He has had to hire a lawyer to sue the bank to let his parents access their own money.”

That article also discusses how some companies have simply stopped hiring Americans for jobs with signing authority over accounts because that would require these foreign firms to spend money and time reporting to the IRS, even if they have no US business. I have personally lost a business opportunity as a result of this. 

And for the third painful story, a tax lawyer writes to the House Ways and Means committee to explain how US tax law for expatriates is hurting many innocent people. He talks about how Americans are often double-taxed on social security (this is usually in countries without tax treaties with the US — about two-thirds of the world's countries), how we're taxed on our retirement plans, and many other areas. While I've read that the Committee on Tax Reform was interested enough in the letter to fix the problem, I've no evidence that this is true. I list this as a "painful story" because this problem is still very real and I do not believe the government wants to fix it. When you have such factually void stories as this Mother Jones hit piece against Rand Paul (a man I otherwise don't particularly care for), it's hard to get politicians to look past the emotion and try to get to the truth. Nobody cares about the one in fifty Americans living abroad.

On the bright side, for most Americans living abroad, this actually won't impact you very much. You'll annually spend several hundred dollars filing a tax return with the US government but not owe any money. However, for those unlucky enough to get caught up in the IRS' web of hunting down those who fall afoul of little-publicized laws, it's a tough time being an expat. Of course, that's why we have far more Americans renouncing their citizenship than ever before.

Spit, Shoes, and Austin

Austin Skyline at Night
Photo by LoneStarMike

I'm writing this from Austin, Texas. I grew up more or less in Texas and it's been 26 or 27 years since I've been back. I'm only here for three days where I'll be speaking at a conference, and while I'm looking forward to seeing some of my professional colleagues again, I'm really looking forward to meeting some family members I've not seen in years (or in some cases, ever). I'm also craving Tex-Mex cooking. I've not had proper Tex-Mex in a long time and in Europe it's almost invariably rubbish. As I explain to my European friends who tell me that they don't like Mexican food: "you've probably never had it."