CEO of Nethemba - Slovak IT security company founded in 2007, primarily focused on web application security and various penetration tests.
How to leave the system
(while staying in one place)
The manual for EU citizens.
What to do with the unfortunate...
- Tax master
- Mandatory health insurance
- Bureaucratic company
- Bank account and mobile operator
This presentation does NOT apply to digital nomads, i.e. people who can afford not to live in any country for more than 183 days a year and at the same time have a favorable tax residency in a country with territorial taxation.
On the contrary, it applies to ALL who are EU citizens and have to or want to live in one place in any EU country for a long time.
And at the same time, they want more freedom and better services.
Problems you are currently facing if you live most of the time in any EU country:
- You have a terrible tax master (you have to pay taxes on worldwide income, including crypto)
- You are an involuntary client of an oligopoly of state-licensed health insurance companies in your EU country.
- Where you can't pay for "extra" experimental treatments, special access, higher comfort, etc.
- Due to the health insurance companies' quotas with health facilities, you may have less access to health services.
- If you already get cancer, it is too late to get better treatment in the best hospital in the world (no global health insurer will cover you afterward)
- You use an ultra-bureaucratic EU company with a high tax burden
- You are spied on by the state, banks and mobile operators
What to do with the lousy tax slaver?
Bad news: You won't get rid of it unless you want to live abroad / have a center of life interests elsewhere most of the time
The excellent news: Live on debt that you can pay off at any time - you don't pay taxes on debt. Instead, you can put the interest towards your expenses.
1. If you don't have Bitcoin, buy enough.
2. Use it as collateral and borrow new fiat money (USD, EUR). For example, via firefish.io. nexo.com, ..)
3. Live off your crypto loan for a long time.
4. Once in a while, pay back part of it or replenish the collateral.
5. If the annual inflation is higher than your annual interest / estimated annual Bitcoin growth, you'll still make money on it (quite probably). Everybody believes in the "Bitcoin moon" :-)
I don't have any BTC, but I have a working business:
1. Your company has income - either for invoices paid in crypto or it buys crypto on the exchange (for example, an Estonian company doesn't make a profit until it pays it out).
2. It uses it as collateral - and borrows new fiat money (USD, EUR).
3. It will then lend you this money (stablecoin) as the owner/individual.
4. Occasionally, you repay part of this loan to your company.
5. The firm, in turn, takes care of the crypto loan - it adds collateral or returns part of the borrowed fiat money.
6. You pay interest to your firm, which pays interest to the crypto lender.
7. If the annual inflation exceeds your total annual interest / estimated annual Bitcoin growth, you still make money.
Rich people live on loans - and therefore don't pay taxes.
Recommended course (10% discount on "liberationtravel" voucher):
What about the unfortunate compulsory health insurance?
You can get rid of it:
- If you cancel your permanent residence in your EU country
- At the same time, you will not have any income as a tax resident of your EU country as a natural person.
This may not be a big deal since:
- As an EU citizen, you can live in your home country for a long time without permanent residency if you leave for a day every 90 days and come back again (probably you cannot apply for a gun permit, renew your driver's license or apply for a loan/mortgage at your local bank).
- As you will be living on a (crypto)loan, you will not have any income as a natural person.
But I want my gun permit!
Unfortunately, getting one is usually impossible without a permanent residence in your home country.
I want my EU driving license!
You can also drive on most EU roads with a Paraguayan, Panamanian, or any other driving license (we will be happy to help you with residency in these countries and obtaining driving licenses).
I want to apply for a loan/mortgage in my bank!
Unfortunately, this is not possible without permanent residence in your home country. But you can use unregulated crypto loans.
Why global private health insurance instead of your compulsory insurance?
- Superior coverage, ability to pay extra for better services, higher accessibility, and experimental treatments - you visit the best hospitals in the world and the best doctors, pay with cash/card, and get reimbursed back under your insurance plan.
If you get cancer or severe illness, no global private health insurance company will cover you anymore!
- But the oligopoly of state-licensed health insurance companies in the case of compulsory health insurance must always insure you - if you regain permanent residence in your EU country (a trivial process if you are an EU citizen) and start paying health insurance in your home country again.
Varied range of global health insurers
What to do with an unfortunate, bureaucratic EU company?
- Unless you have a serious reason why your company needs to be an EU legal entity (e.g., your work is demonstrably done in that country), using bureaucratic EU companies to do business (especially when invoicing services) is usually pointless.
- Foreign companies (e.g., US, UK, UAE) can be significantly less bureaucratic, often without an accountant, with a somewhat better tax burden.
- Dividends can be paid in crypto (XMR, BTC) or to a non-CRS bank account
As a tax resident of the EU, you are still subject to tax on dividends/profits paid from your foreign company (but it may be worth the saved bureaucracy and associated costs)
What about the unfortunate bank account?
Bad news: EU banks may make it impossible to open a bank account unless you are a permanent resident there. Alternatively, they may make opening it conditional on your official income.
The excellent news: Do not use the EU banks; open an account in Georgia (Bank of Georgia, SOLO.GE) or Gibraltar (XAPO.COM).
An account in the above banks is opened on your passport with no special requirements. It is possible to use the address of any country. Nobody cares about your residency.
Start using the most elite SOLO Club bank account at the Bank of Georgia:
- Top VISA Platinum card with a daily ATM withdrawal limit of 7034 EUR, card payment with a daily limit of 35100 EUR
- Using your Mastercard World Elite, you have unlimited access to airline lounges worldwide
- NO CHARGES ANYWHERE IN THE WORLD when paying by VISA Signature card or withdrawing from an ATM (SOLO Club program)
- They do not care about your residence; you need a valid passport and an address where your physical cards will be delivered.
- Annual account maintenance fee of 281 EUR (at Liberation.Travel we can open it for you remotely for 997 EUR); other programs are even cheaper
Minimize state spying:
- Prefer the use of cash and anonymous cryptocurrencies (Bitcoin Lightning, Monero)
- If you need to use bank accounts, open them in non-CRS countries (Georgia, Paraguay)
- Avoid KYC SIM cards (most EU countries)
- Use anonymous e-SIMs (Bitrefill, KeepGo, Silent.Link) or Czech/UK SIM cards
- Use secure phones (Google Pixel with GrapheneOS) or laptops (Google Tablet with GrapheneOS)
- Avoid GSM calls, always prefer end-to-end encrypted communication (Signal, Session, SimpleX)
"Opting out" of the system while staying in one place may look like this:
1. Cancelled permanent residence in your home country, you can live there as a citizen for 90 days without a residency permit
2. No official income as a natural person - living on (crypto) loans.
3. You can ask for other documents (like driving licenses) from other countries with residency (Paraguay, Panama, etc.).
4. No compulsory health insurance in your home country; instead, a very good global health insurance company.
5. No bureaucratic EU company doing business through a company in non-bureaucratic offshore legislation.
6. Preference for the use of cash, Bitcoin Lightning, and Monero.
7. No EU bank account - instead, a premium SOLO.GE account in the Bank of Georgia) where your crypto loan money goes
8. No more KYC SIM cards - instead use of BitRefill, or KeepGo.
The opportunity to leave for a better place is already there, even for those who are going nowhere.
How to leave the system (while staying in one place). For the EU citizens.
By Pavol Luptak