Paraguay V Argentina, Lifestyle And Taxes

[steveinbsas]

Also, what is this bienes personales tax? Is it some kind of tax on assets which have been accumulated prior to even residing in Argentina?

It is what we would call a personal property tax and applies to all of your assets at the end of the calendar year (with the possible exception of cash in savings accounts), It doesn't matter when you acquired the assets or where they are located.

 

[RodalfoWalsh]

Bienes personales is an asset tax of 2% for people who have assets over a certain value. There are a fair number of exceptions and a good deal of uncertainty about the tax's future. That is also true of income tax with certain incomes streams being tax exempt. Best bet is to talk to an accountant. The most likely answer is that your direct personal tax burden will not be dissimilar to other countries. Argentina collects most of its taxes indirectly.

Those numbers in your latest might actually be on the high side if you're talking about living in a non urban area.

 

[steveinbsas]

I saw many nice properties for about 200,000 USD using the REMAX website which I actually got from one of your threads on rural living (great thread by the way). Some are in Barrios Cerrados. I suppose there is a monthly fee for living in one of those.

Thanks for the compliment. Please post links to properties you find on the Internet in this thread (especially listed by ReMax as it's easy to download and save the pdf version even after the listing has been removed). I continue to "research" alternative place to live in Argentina on a regular basis.

If I know anything about the areas in which the properties are located I'll let you know, and others can comment as well.

 

[Tres Picos]

Well, 2% on assets per year is a complete killer. My figure of 40k/year comes from a reasonable albeit conservative 2% ROI on a 2M portfolio (including real estate, stocks, metals, etc.). In my opinion, people have to be lucky to get 4% a year.

On top of that, they will charge a tax on the income generated? 20% or so?

My entire expected income would be taken.

I'm guessing no Argentinos actually pay this 2%.

 

[Tres Picos]

Those numbers in your latest might actually be on the high side if you're talking about living in a non urban area.

My typo resulted in a $1000/month for electronics!

Fixed and now it's a more reasonable 3.3k USD / 52k ARS per month.

Of course, after taxes it's still appears hopeless.

 

[RodalfoWalsh]

2% was a typo. I meant to write 1/2%

 

[Tres Picos]

2% was a typo. I meant to write 1/2%

Hmmm, I see. Still a massive tax but maybe workable.

 

[steveinbsas]

Well, 2% on assets per year is a complete killer. My figure of 40k/year comes from a reasonable albeit conservative 2% ROI on a 2M portfolio (including real estate, stocks, metals, etc.). In my opinion, people have to be lucky to get 4% a year.

Agreed, but I think the rate is less than 2%.

On top of that, they will charge a tax on the income generated? 20% or so?

I believe that 20% might be correct, but it might be the minimum rate on passive income. I think that's the lowest tax rate on rent if the individual receiving the income declares it following certain guidelines, but I've never received rental income in Argentina.

My "investment" income combined with my "pension" income do not reach the taxable threshold in Argentina and none of the assets that generate my passive income are in my name and I have no control over them; they are in an irrevocable trust.

I'm guessing no Argentinos actually pay this 2%.

I think the rate varies from .50% to 1.5%, depending on the amount of the assets, but many Argentines don't pay the bienes personales.

I don't pay this tax now, but it's only because the combined tax valuation of my property and car are below the taxable threshold for the bienes personales.

I paid it once (with massive interest) for 2006, 2007, and 2008 when i sold my apartment in 2009.

The real estate agent never told me about the bienes personales and AFIP never sends a bill.

I'm sorry this is a deal breaker for your move to Argentina but I certainly understand why.

 

[Tres Picos]

Interesting, some kind of trust setup? If possible, that would solve it. Can't stand dealing with this kind of thing though which is why I'm tempted to go for Paraguay even though I much prefer Argentina's geography, climate, and future opportunities for my children.

What are the thresholds for property and car?

I'd love to get your feedback on some properties. Will post some tomorrow...unfortunately I'm still on GMT+7.

 

[steveinbsas]

Interesting, some kind of trust setup?

Yes, an irrevocable trust.

What are the thresholds for property and car?

It was raised last year to $800,000 pesos and may be raised again this year. I believe it is "supposed" to be eliminated in 2018 or 2019, but that may depend on additional legislation being passed....