When most people think about Working Holiday Visas, they think about backpacking around Australia, picking fruits on farms to earn money along the way. What I doubt anyone thinks about is banking and residencies. In this article, I explain why you should and present some interesting opportunities.
The idea
For years I dismissed Working Holiday Visas as a backpacker thing, something of little use to me. This all changed when I realized that countries such as Hong Kong, Singapore, Taiwan and Switzerland offer them. Now, do I want to work in any of these countries? No. What I want are residencies and those valuable ID cards that make banking so much easier. In some cases, these ID cards can even enable the building of credit history, something I cover in my Offshore Credit guide.
This is especially interesting when you consider how easy it is to apply for a Working Holiday visa. It really is one of the easiest pathways to quality offshore banking, at least for those young enough to apply.
Do note that having a Working Holiday Visa will not offer you any tax benefits in and of itself and will not make you a tax resident of the visa country. In most cases, you need to actually live there to gain tax benefits, or establish significant ties.
Options
There are a surprising number of countries offering Working Holiday Visas. Below is the complete list with the countries bolded being those that offer quality banking.
Andorra, Argentina, Australia, Austria, Bangladesh, Belgium, Brazil, Canada, Chile, Colombia, Costa Rica, Croatia, Cyprus, Czech Republic, Denmark, Estonia, Finland, France, Germany, Greece, Hong Kong, Hungary, Iceland, Indonesia, Ireland, Israel, Italy, Japan, Latvia, Lithuania, Malaysia, Malta, Mexico, Monaco, Netherlands, New Zealand, Norway, Peru, Philippines, Poland, Portugal, Romania, Russia, Singapore, Slovakia, Slovenia, South Africa, South Korea, Spain, Sweden, Switzerland, Taiwan, Thailand, Turkey, Ukraine, United Kingdom, United States, Uruguay and Vietnam.
For country-specific requirements, read this Wiki article. I also provide a few recommendations below.
Costa Rica
Available for citizens of: Canada
Tax system: Territorial
My opinion:
While I would not recommend Costa Rica as a banking destination, it is a fantastic place to use as a home base. The territorial nature of its tax system means that only locally-sourced income is subject to local taxation. If you generate mostly passive income, or generate most of your income outside Costa Rica, you can live there for a year using a Working Holiday Visa, tax-free or nearly so.
Hong Kong
Available for citizens of: Australia, Canada, France, Germany, Ireland, Japan, South Korea, New Zealand and the United Kingdom
Tax system: Territorial
My opinion:
Hong Kong is a fantastic banking jurisdiction. If you are the citizen of one of the countries listed above, you can apply for a Working Holiday Visa directly in Hong Kong and then an HKID. The HKID allows you to open bank accounts at any of the local banks as well as apply for unsecured credit cards. There is no expiry date on it so you can continue using it for banking purposes even after the expiry of the visa.
Malaysia
Available for citizens of: New Zealand
Tax system: Territorial
My opinion:
Malaysia, similarly to Costa Rica, is not a great banking jurisdiction. It is a territorial taxation country, however, has year-round warm weather, is well connected and is fantastically cheap to live in. This makes it a great base to spend a year in for location independent New Zealanders whose primary source of income is passive, or generated outside Malaysia.
Monaco
Available for citizens of: United Kingdom
Tax system: Tax haven
My opinion:
Monaco is the only true tax haven offering a Working Holiday visa. Citizens of the UK can obtain a two year resident permit allowing them to live and work in the tiny country. The resident permit can also allow them to open resident bank accounts.
Singapore
Available for citizens of: Australia, France, Germany, Hong Kong, Japan, New Zealand, Switzerland, United Kingdom and the United States
Tax system: Territorial
My opinion:
Singapore has some of the most solid banks in the world. While the Singapore Working Holiday Visa is only valid for six months, it still entitles its holders to apply for a local resident ID card (not a full NRIC). With it, it is easy to open bank accounts and apply for unsecured credit cards.
Switzerland
Available for citizens of: Canada
Tax system: Residential
My opinion:
While Switzerland is not the privacy haven that it once was, it still is a fantastic banking jurisdiction. Holders of the Working Holiday Visa are entitled to apply for a local resident ID card. With it, it is easy to open bank accounts and apply for credit cards (provided that you have a stable source of income).
Taiwan
Available for citizens of: Australia, Austria, Belgium, Canada, Germany, Hungary, Ireland, Japan, South Korea, New Zealand, Poland, Slovakia and the United Kingdom
Tax system: Territorial (sort of)
My opinion:
Taiwan has decent banks but opening accounts can be challenging, even as a resident. It is, however, a fantastic place to live in for a year.