mathematical formula for when long term visas sensible?
mathematical formula for when long term visas sensible?
I am an arithmetical moron. I ran a mail order newsletter business for two years without ever doing a financial statement.
Anyway, here is my current challenge - how to figure out whether it is worthwhile to get a 6 or 12 month visa. Everytime I take out a new CD (fixed deposit to some of you) the financial institution starts from scratch asking for a letter from my employer, my lease and my visa. Since in Cambodia there is no such thing as legal residency for foreigners, no work permits and no retirement program I have to jump through these hoops. My question is at what point does it make financial sense?
Consider the factors...
1. total dollars in CDS
2. interest rate
3. taxation rate on yield for non-residents (12%)
4. taxation rate on yield for residents (4%?)
5. whether this will actually be honoured
6. number of visits per year
7. How long you stay each time
8. price of visa
9. whether long - term visas will continue to be issued as a business
10. whether Lucky Lucky's red ink stamp runs out
11. whether if you have a current 1-year visa, you will be grandfathered in
12. strictness of bank/credit union/MFI
13. strictness of taxation inspectors
Clearly, if you stay in Cambodia 10 months a year, invest $150,000 in CDs, own an apartment and run a business it makes sense to have a 1-year visa. However, if you visit Cambodia twice a year, stay in guesthouses and have already invested in CDs and now just want to sock away some more (say 5K at 6->8.5%) perhaps it is not cost efficient to try to lower tax rate . Where is that point?
Math whizes?
PS. I am all for corruption in petty matters, what gets to me is inefficient and duplicitous corruption. You don't just pay the money, you also jump through hoops and then it is not honoured (viz passports issued in early 1990s and 10 year driver's licenses)
OK, so there are two issues in this post. My major concern is learning the mathematical formula.
Anyway, here is my current challenge - how to figure out whether it is worthwhile to get a 6 or 12 month visa. Everytime I take out a new CD (fixed deposit to some of you) the financial institution starts from scratch asking for a letter from my employer, my lease and my visa. Since in Cambodia there is no such thing as legal residency for foreigners, no work permits and no retirement program I have to jump through these hoops. My question is at what point does it make financial sense?
Consider the factors...
1. total dollars in CDS
2. interest rate
3. taxation rate on yield for non-residents (12%)
4. taxation rate on yield for residents (4%?)
5. whether this will actually be honoured
6. number of visits per year
7. How long you stay each time
8. price of visa
9. whether long - term visas will continue to be issued as a business
10. whether Lucky Lucky's red ink stamp runs out
11. whether if you have a current 1-year visa, you will be grandfathered in
12. strictness of bank/credit union/MFI
13. strictness of taxation inspectors
Clearly, if you stay in Cambodia 10 months a year, invest $150,000 in CDs, own an apartment and run a business it makes sense to have a 1-year visa. However, if you visit Cambodia twice a year, stay in guesthouses and have already invested in CDs and now just want to sock away some more (say 5K at 6->8.5%) perhaps it is not cost efficient to try to lower tax rate . Where is that point?
Math whizes?
PS. I am all for corruption in petty matters, what gets to me is inefficient and duplicitous corruption. You don't just pay the money, you also jump through hoops and then it is not honoured (viz passports issued in early 1990s and 10 year driver's licenses)
OK, so there are two issues in this post. My major concern is learning the mathematical formula.
This is not true sorry. You can achieve citizenship also if you want to avoid visa costs full stop. Over what period do you intend to run your little CD empire, maybe that has a bearing on whether it is worth forking out the cost of citizenship & a Cambodian passport, etc.hermespan wrote:Since in Cambodia there is no such thing as legal residency for foreigners, no work permits...
Meum est propositum in taberna mori,
ut sint Guinness proxima morientis ori.
tunc cantabunt letius angelorum chori:
"Sit Deus propitius huic potatori."
ut sint Guinness proxima morientis ori.
tunc cantabunt letius angelorum chori:
"Sit Deus propitius huic potatori."
I have a lot of term deposits at Micro finance institutes, and have done for the last 5 or 6 years. (And have never at any of the 3 been asked for more than photocopy of my passport)
But after the OP's post I am for the first time having doubts about the wisdom of investing in them...add to tht the fact that most often at these MFI's the majority of the customers are signing with a thumb print...and I really am starting to have doubts.
But after the OP's post I am for the first time having doubts about the wisdom of investing in them...add to tht the fact that most often at these MFI's the majority of the customers are signing with a thumb print...and I really am starting to have doubts.
If you're in the big MFIs I wouldn't worry, some of them operate better than local banks - better to have something tucked away than nothing.
Meum est propositum in taberna mori,
ut sint Guinness proxima morientis ori.
tunc cantabunt letius angelorum chori:
"Sit Deus propitius huic potatori."
ut sint Guinness proxima morientis ori.
tunc cantabunt letius angelorum chori:
"Sit Deus propitius huic potatori."
Sheesh the OP is jumping all over the place. First he's into offshore gold and HKD/SGD deposits and wants to depart for good for "more adventurous pastures than boring old backpacker Cambodia with its 'scammy' central bank's fractional reserve banking"..... now he's apparently fallen back in love with this here Kingdom and its financial institutions .. what will it be tomorrow, once again looking for riverside property to "invest" in? Keep us in the loop
rebo wrote:So what you are asking is it better to spend $310 (2x$155) or $285?
My mathematical advice is:
Take a long walk on a short pier
No, whether it makes more financial sense to pay the higher non-resident tax on capital gains of $500 or pay $155 for a six month visa (alternatively $285 for a year). My concern is that this long term visa for investment purposes might be wasted. How do we know that the MFI and/or tax inspectors won't require the same at cash- out time?rebo wrote:So what you are asking is it better to spend $310 (2x$155) or $285?
My mathematical advice is:
Take a long walk on a short pier
OK, but one of the purposes of seei g your pasdport is to detetmine your visa status and therefire what capital gains tax you are listed to pay.Rama wrote:I have a lot of term deposits at Micro finance institutes, and have done for the last 5 or 6 years. (And have never at any of the 3 been asked for more than photocopy of my passport)
But after the OP's post I am for the first time having doubts about the wisdom of investing in them...add to tht the fact that most often at these MFI's the majority of the customers are signing with a thumb print...and I really am starting to have doubts.
What are you mentioning capital gains tax for? There is no CGT on term deposits because by their nature term deposits are cash and don't appreciate in value. The banks and MFIs pay you interest net of resident withholding tax, the rate of which is determined by your visa status.hermespan wrote:
OK, but one of the purposes of seei g your pasdport is to detetmine your visa status and therefire what capital gains tax you are listed to pay.
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I thought the same thing once I got about 1/3 into his post.Playboy wrote:
scobienz wrote:What are you mentioning capital gains tax for? There is no CGT on term deposits because by their nature term deposits are cash and don't appreciate in value. The banks and MFIs pay you interest net of resident withholding tax, the rate of which is determined by your visa status.hermespan wrote:
OK, but one of the purposes of seei g your pasdport is to detetmine your visa status and therefire what capital gains tax you are listed to pay.
CGT, snapital gains tax, whatever - the state of Cambodia will keep some of my earnings on interest (unlike Singapore and Hong Kong - which pay garbage interest so they aren't better. ) I want to minimize this skimming since The bank and MFI are acting as tax collectors at source.
Isn't my question obvious? I take it no one knows about or cares to share the formula comparing cost of visa versus cost of tax.
More likely, no-one cared about that formula before you came along. Be a pioneer and be the first to calculate it.hermespan wrote:scobienz wrote:What are you mentioning capital gains tax for? There is no CGT on term deposits because by their nature term deposits are cash and don't appreciate in value. The banks and MFIs pay you interest net of resident withholding tax, the rate of which is determined by your visa status.hermespan wrote:
OK, but one of the purposes of seei g your pasdport is to detetmine your visa status and therefire what capital gains tax you are listed to pay.
CGT, snapital gains tax, whatever - the state of Cambodia will keep some of my earnings on interest (unlike Singapore and Hong Kong - which pay garbage interest so they aren't better. ) I want to minimize this skimming since The bank and MFI are acting as tax collectors at source.
Isn't my question obvious? I take it no one knows about or cares to share the formula comparing cost of visa versus cost of tax.
Here's a thought, cost of visa is fixed while cost of tax is "relative to your gains and/or capital outlay". You know the fixed visa costs, it cannot be too hard to calculate your potential tax hit. Percentage calculation? That's not a PhD level formula I'm sure. Everyone has their own deposits account with their own bank and their interest offering, tax withheld should be an insanely easy back-of-the-napkin calculation. Otherwise, get an accountant
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